AsianFin -- China's central bank on Wednesday implemented a significant liquidity boost, pumping a near-record amount of short-term funds into the financial system to alleviate a cash squeeze ahead of the upcoming new year holiday. The People's Bank of China injected a net 958.4 billion yuan ($131 billion) through seven-day reverse repurchase agreements in daily open market operations. This figure marks the second-highest injection on record, according to Bloomberg data dating back to 2004.
The central bank's move is intended to mitigate the effects of expiring medium-term lending, the peak tax season, and increased cash demand ahead of the Lunar New Year holidays. The goal is to ensure sufficient liquidity in the banking system, as stated in an official release.
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