Although China’s economy is showing signs of stabilizing, the central bank is experimenting with more delicate tools to support bank liquidity and lending.
Earlier today the PBOC surveyed primary dealers regarding the demand for 28-day reverse bond repo agreements as policy makers are trying to seek alternatives to another cut in how much money banks park at the central bank. This week has been the 10th consecutive week of open market operations conducted by the central bank, the longest since June 2002.