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China central bank makes biggest weekly cash withdrawal since Nov -Breaking

by Mike Robinson

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© Reuters. FILEPHOTO – This photo illustrates a China yuan bill. The illustration was taken on May 31, 2017. REUTERS/Thomas White

SHANGHAI, (Reuters) – China’s central banking institute injected very little cash through short-term loans to the banking system Friday. This effectively retracted most of the liquidity support lent toward the end of 2021.

The People’s Bank of China injected 10 Billion Yuan ($1.57B) to fund seven-day reverse repos. That’s compared to 110 Billion yuan of loans which expired on the same day.

The PBOC drained 660 million yuan in net cash for the week – the largest weekly cash withdrawal since the beginning of November.

However, markets believe China’s central banks will refill liquidity shortages before the Lunar New Year holidays, which fall on January 31 to February 6, this year. Investors remain divided on whether further monetary easing is imminent in China, the second largest economy.

($1 = 6.3822 )

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