China to boost liquidity as market reopens Monday, to put in $174 billion


The people’s Bank of China announced on Sunday that it would put in 1.2 trillion yuan ($174 billion) worth of liquidity into the markets via reverse repo operations on Monday as its stock markets are set to reopen amid the new coronavirus spread.

China previously said it would exhaust all possible means, finding various monetary policy tools, to keep market liquidity enough and aid businesses impacted by the spreading of new coronavirus that has killed at least 350 people in China.

Based on Reuters’ estimate (in reference to China’s central bank figures), 1.05 trillion yuan worth of reverse repos are set to mature on Monday, which means that 150 billion yuan in net cash will be put in.

Highly volatile sessions are expected to be observed in Chinese markets when trades resume on Monday after a hiatus during the Lunar New Year which was extended by the government due to the epidemic.

“We believe that the successive introduction and implementation of policy measures will play a better role in improving market expectations and preventing irrational behavior,” the China Securities Regulatory Commission (CSRC) said.

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