BREAKING NEWS

China cenbank injects 300 billion yuan via one-year MLF, keeps rate unchanged

China cenbank injects 300 billion yuan via one-year MLF, keeps rate unchanged
FILE PHOTO: Headquarters of the People's Bank of China (PBOC), the central bank, is pictured in Beijing, China September 28, 2018. REUTERS/Jason Lee   -  
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JASON LEE(Reuters)
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SHANGHAI (Reuters) – China’s central bank extended 300 billion yuan (33.22 billion pounds) through its medium-term lending facility on Friday, but kept the lending rate unchanged.

The People’s Bank of China (PBOC) said on its website the interest rate on one-year MLF loans <CNMLF1YRRP=PBOC> remained 3.25%, the same as in the previous operations.

The injection of fresh funds exceeded a batch of 187.5 billion yuan worth of such one-year MLF loans due to mature on the same day, injecting a net 112.5 billion yuan into the market.

Investors had been anxious to see if the PBOC would lower the MLF rate again this month following a marginal interest rate cut in November, though traders said they had not expected a rate reduction.

The PBOC cut the interest rate on its one-year MLF loans by five basis points last month for the first time since early 2016, as policymakers work to prop up a slowing economy hit by weaker demand at home and abroad.

The PBOC also said in Friday’s statement that it had skipped reverse repo operations on the day.

Another batch of 286 billion yuan worth of one-year MLF loans is set to expire on Dec.16.

The MLF rate is the price of loans that PBOC lends to commercial banks in the medium term.

(Reporting by Winni Zhou and John Ruwitch; Editing by Shri Navaratnam)

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