China's Central Bank pumps $8.3bn into Market

China's central bank injected 55 billion yuan about (8.3 billion US dollars) into the money market on Tuesday to ease a liquidity strain.

    The People's Bank of China (PBOC) conducted 120 billion yuan of seven-day reverse repurchase agreements (repo), a process in which central banks purchase securities from banks with an agreement to resell them in the future. The reverse repos were priced to yield 2.25%, unchanged from Monday's injection of 65 billion yuan, according to a PBOC statement.

    Reverse repos worth 65 billion yuan matured on Tuesday, so the central bank has effectively injected 55 billion yuan into the market, according to China's (Xinhua) News Agency.

    In Tuesday's interbank market, the benchmark overnight Shanghai Interbank Offered Rate (Shibor), which measures the cost at which Chinese banks lend to one another, climbed 0.8 basis points to 2.01% after the injection. Shibor for one-week loans rose 0.4 basis points to 2.338%.