SHANGHAI (Reuters) – China’s central bank partially rolled over maturing medium-term policy loans while keeping the interest rate unchanged on Thursday, matching market expectations.
The People’s Bank of China (PBOC) said it was keeping the rate on 400 billion yuan ($57.46 billion) worth of one-year medium-term lending facility (MLF) loans to some financial institutions unchanged at 2.75% from the previous operation.
With 600 billion yuan worth of such loans maturing on the same day, the fund injection led a net withdrawal of 200 billion yuan from the banking system.
In a poll of 28 market watchers conducted this week, 27 respondents forecast no change to the MLF rate, while one expected a marginal interest rate cut.
The central bank also injected 2 billion yuan through seven-day reverse repos while keeping borrowing cost unchanged at 2.00%, it said in an online statement.
The PBOC surprised markets in August by lowering both rates by 10 basis points to revive credit demand and support an economy hurt by COVID-19 shocks.
($1 = 6.9612 Chinese yuan)
(Reporting by Winni Zhou and Brenda Goh; Editing by Shri Navaratnam)
