Central bank steps up liquidity injections ahead of Lunar New Year

The People’s Bank of China this week used two money-market operations to inject a net RMB590 billion in the biggest such move in three years, Bloomberg reported, citing market data. The injection comes as policymakers are working to prevent an annual tightening of liquidity ahead of this year’s Lunar New Year holiday. “As the central bank has become less willing to cut reserve-requirement ratios, such short-term funds are only keeping the money market tightly balanced,” said Liu Changjiang, a bond analyst at Soochow Securities. The central bank also stated on its website that it would conduct open-market operations every work day from January 29 through February 19.