China's PBOC to skip open market operations for 4th straight trading day - statement

SHANGHAI (Reuters) - China’s central bank said it would skip open market operations for a fourth straight trading day on Wednesday in order to keep liquidity stable in the country’s banking system.

“The overall liquidity in the banking system is staying at a relatively high level,” the PBOC said in a statement on its website.

In order to “keep liquidity basically stable in the banking system”, the central bank decided to skip the reverse repurchase agreement operations on Tuesday, it added.

The PBOC has drained a net 395 billion yuan ($57.40 billion) so far this week.

In early trade on Wednesday, the volume weighted average of the seven-day repo rate CN7DRP=CFXS was at 2.35 percent, down 8.47 basis points from the previous closing average rate.

The PBOC surprised financial markets on Friday by increasing the interest rates on open market operations by 10 basis points, on the first day back from the long Lunar New Year holidays.

($1 = 6.8821 Chinese yuan)

Reporting by the Shanghai Newsroom; Editing by Sam Holmes