On Tuesday (March 24), the People's Bank of China conducted a 7-day reverse repo operation of 17.5 billion yuan through a fixed interest rate, quantity tender method, maintaining the rate at 1.40%. This operation has reduced the outstanding balance of reverse repos to 79.5 billion yuan, marking the lowest level since January 2025.
This operation continues the trend of net withdrawal in open market operations, achieving net withdrawal for the fifth consecutive day, with a total scale of 33.5 billion yuan. Analysts believe this reflects the central bank's precision in liquidity management and also demonstrates the market's relative stability in short-term funding demand.
With the gradual withdrawal of funds, the supply of funds in the market is relatively tight, which might have some impact on the interest rates of the short-term money market. As the remaining reverse repos for March gradually mature, market liquidity in the coming days may receive further attention.
