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China injects $15.4 billion to revive economy

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Chinese President Xi Jinping holds a welcoming ceremony for U.S. President Barack Obama (3rd L) at the Great Hall of the People in Beijing, capital of China (File)

China’s central bank injects liquidity into market….reports Asian Lite News

Chinese President Xi Jinping  holds a welcoming ceremony for U.S. President Barack Obama (3rd L) at the Great Hall of the People in Beijing, capital of China (File)
Chinese President Xi Jinping holds a welcoming ceremony for U.S. President Barack Obama (3rd L) at the Great Hall of the People in Beijing, capital of China (File)

China’s central bank on Friday offered a total of 100 billion yuan ($15.4 billion) in six-month medium-term lending facility (MLF) loans at 3.25 percent to 13 financial institutions.

“The move is aimed at maintaining proper liquidity in the market,” said the People’s Bank of China (PBOC) in a statement.

The PBOC said it will guide banks to lend the money to small businesses and the agricultural sector, Xinhua news agency reported.

The MLF is a new liquidity tool designed for commercial and policy banks to borrow from the central bank by using securities as collateral.

The central parity rate of the Chinese currency renminbi (yuan) weakened by 57 basis points to 6.4814 against the US dollar on Friday, according to the China Foreign Exchange Trading System.

In China’s spot foreign exchange market, the yuan is allowed to rise or fall by two percent from the central parity rate each trading day, Xinhua reported.

The central parity rate of the yuan against the US dollar is based on a weighted average of prices offered by market makers before the opening of the interbank market each business day.