Money

China's central bank sells 56b yuan 1-year bills

(Xinhua)
Updated: 2010-09-07 16:43

BEIJING - The People's Bank of China (PBOC), China's central bank, auctioned 56 billion yuan ($8.26 billion) of one-year bills through its regular open market operations Tuesday at a yield of 2.0929 percent.

Spending for better life? Related readings:  China's central bank issues 24b yuan 1-yr bills  PBOC sells 33b yuan of 1-yr bills at yield of 2.0929%  China's 9-month bills draw more bank bids  China's central bank sells 18b yuan of 1-yr bills

The yield of one-year bills has been unchanged at 2.0929 percent since June 8.

Bills and repurchase agreements worth 274 billion yuan ($40.41 billion) will mature this week, a sharp increase from 100 billion yuan last week.

Li Rong, a fixed-income analyst at Shenyin Wanguo Securities, said the money market would remain loose this week.

"I expect a net liquidity injection between 40 billion yuan to 60 billion yuan by the central bank this week," Li said.

Demand for cash in the market was another factor the PBOC has to take into account when carrying out its open market operations this week, she said.

About 700 billion to 800 billion yuan of liquidity will be locked up in the market this week as shares of seven companies were open to subscribers for their initial public offerings, she said.