SHANGHAI/SINGAPORE – China’s central bank boosted liquidity injections but kept the interest rate unchanged when rolling over maturing medium-term policy loans on Wednesday, matching market expectations.
The People’s Bank of China (PBOC) said it was keeping the rate on 1.45 trillion yuan ($199.92 billion) worth of one-year medium-term lending facility (MLF) loans to some financial institutions unchanged at 2.5 percent from the previous operation.
All 31 market watchers polled by Reuters this week expected the central bank to inject fresh funds to exceed the maturity.
With 850 billion yuan worth of MLF loans set to expire this month, the operation resulted a net 600 billion yuan fresh fund injection into the banking system.
The central bank also injected 495 billion yuan through seven-day reverse repos while keeping borrowing cost unchanged at 1.8 percent , it said in an online statement.