Experts of the central banks multi day reverse repurchase

category:Finance
 Experts of the central banks multi day reverse repurchase


Wang Qing told reporters that the direct reason for the central banks resumption of reverse repurchase operation on October 15 was that the large-scale issuance of treasury bonds and local government bonds started again on October 14, and the market funds were tightened. In order to guide the short-term market interest rate represented by dr007 to fluctuate around the short-term policy interest rate (the central banks 7-day reverse repurchase rate) and avoid excessive upward deviation from the policy interest rate center, the central bank injects liquidity into the market through reverse repurchase to smooth the fluctuation of capital.

From the perspective of dr001 and dr007, which reflect inter-bank liquidity, the weighted average prices of the two indicators rose slightly this week. The weighted average price of dr001 rose 20.3bp to 2.1995% on October 19, according to wind data. The weighted average price of dr007 rose 6.27bp to 2.2494% on October 19 and 5.52bp to 2.3046% on October 20.

Wang Qing further pointed out that we have noticed that since August, the average value of dr007 has stabilized near the short-term policy interest rate, which means that the short-term market interest rate has no longer continued to rise, and the tight currency process since May has shown some signs of easing. However, since October, the interbank certificate of deposit interest rate has maintained a rapid upward trend as a whole, and the underlying reason is that the task of reducing the pressure of structural deposits of banks in the fourth quarter is still very heavy. In the medium term, it is expected that there will be pressure from the government to issue bonds in the short term due to the pressure on the market. However, with the end of the year approaching, both of these factors tend to ease. By then, the issuing rate of inter-bank certificates of deposit is expected to change from up to down, and the tight currency process will come to an end. Source: Chen Hequn, editor in charge of economic report in the 21st century_ NB12679

Wang Qing further pointed out that we have noticed that since August, the average value of dr007 has stabilized near the short-term policy interest rate, which means that the short-term market interest rate has no longer continued to rise, and the tight currency process since May has shown some signs of easing. However, since October, the interbank certificate of deposit interest rate has maintained a rapid upward trend as a whole, and the underlying reason is that the task of reducing the pressure of structural deposits of banks in the fourth quarter is still very heavy.

In the medium term, it is expected that there will be pressure from the government to issue bonds in the short term due to the pressure on the market. However, with the end of the year approaching, both of these factors tend to ease. By then, the issuing rate of inter-bank certificates of deposit is expected to change from up to down, and the tight currency process will come to an end.