I posted earlier on this, repeating it here:
- PBOC injected 74.5 bn yuan liquidity to banking system via 14-day reverse repo, with rate lowered to 1.85% from 1.95%.
- also injects 160.1 bn yuan liquidity via 7-day reverse repo, with rate unchanged at 1.7%.
There has been ongoing speculation of a rate cut from the Bank, given the slowing in economic growth and other indicators.
The jumbo rate cut from the FOMC last week was viewed as giving many Asian central banks, such as the PBOC, room to ease without pressuring their currencies lower. The PBOC has taken advantage.
The caveat is that its the 7-day RR that is the main policy rate in China now. This cut to the 14-day is something, but it’s a nudge only.