BEIJING - China’s central bank conducted 100 billion yuan (about 14 billion US dollars) of 14-day reverse repos at an interest rate of 1.95 percent Monday. The People’s Bank of China (PBOC) on the same day reduced the reserve requirement ratio (RRR) for financial institutions by 0.5 percentage points, which is set to unleash about 1 trillion yuan of long-term liquidity. This came as the PBOC announced last month to ax the RRR, the re-lending and re-discount interest rates for the rural sector and small businesses to shore up the economic recovery and confidence. A reverse repo is a process in which the central bank purchases securities from commercial banks through bidding, with an agreement to sell them back in the future.
CHINESE YUAN WEAKENS TO 7.1070 AGAINST USD MONDAY
The central parity rate of the Chinese currency renminbi, or the yuan, weakened 64 pips to 7.1070 against the US dollar Monday, according to the China Foreign Exchange Trade System. In China’s spot foreign exchange market, the yuan is allowed to rise or fall by 2 percent from the central parity rate each trading day. 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.
CHINA’S ROAD LOGISTICS PRICE INDEX UP
China’s road logistics price index edged up 0.03 percent week on week from Jan 29 to Feb 2 as demand in the market remained generally stable amid slower supply expansion, industry data shows. The country’s road logistics index came in at 1,038.95 points last week, according to a survey jointly conducted by the China Federation of Logistics and Purchasing and the Guangdong Lin’an Logistics Group. The sub-indices of all types of vehicles logged mild increase week on week. Specifically, the figure for the full-truckload logistics price, which primarily measures bulk commodity and cross-regional transportation, stood at 1,040.28 points in the period, up 0.03 percent on a weekly basis.