Taking care of month-end liquidity, the central bank “released water” 900 billion yuan in 6 trading days | liquidity | central bank | reverse repurchase_Sina Technology_Sina.com

Original title: Taking care of month-end liquidity, the central bank “released water” 900 billion yuan in 6 trading days

On October 20, the central bank once again restarted 100 billion yuan of reverse repurchases, operating a total of 900 billion yuan of reverse repurchases for 6 consecutive working days.

On October 27, the central bank announced again that in order to hedge against the impact of tax peaks, government bond issuance payments and other factors, and maintain stable liquidity at the end of the month, it carried out a 200 billion yuan reverse repurchase operation through interest rate bidding, and the winning interest rate was 2.20%. , Because there were 100 billion yuan of reverse repurchase and 70 billion yuan of treasury cash deposits due on the same day, which is equivalent to 30 billion yuan of investment.

This is the third operation with a scale of 200 billion yuan this week. Starting from October 20, the central bank has already invested 900 billion yuan in six trading days.

100 billion reverse repurchase for 6 consecutive trading days

At the beginning of this month, the central bank’s reverse repurchase operations did not exceed 10 billion yuan per trading day, roughly the same as before. After October 20, the situation changed. The central bank once again restarted 100 billion yuan of reverse repurchases, operating a total of 900 billion yuan of reverse repurchases for 6 consecutive working days. Regarding the reasons, the central bank has stated that it is necessary to hedge against the impact of tax periods, government bond issuance payments and other factors, and to maintain reasonable and adequate liquidity in the banking system.

Some analysts believe that around the 23rd of each month is the time when companies pay taxes. October coincides with the largest month of corporate income tax payment, and the amount is expected to exceed 600 billion yuan. In addition, 140 billion yuan of national bonds and 652.6 billion yuan of local government bonds will be issued from October 21st to 31st. The scale will increase significantly. For the sake of smoothing liquidity, the central bank moderately intensifies reverse repurchase operations, and intends to stabilize the above in the short term. Volatility in money market interest rates caused by two factors.

The central bank has continuously carried out relatively large reverse repurchase operations, which means that this month’s RRR cut may fail. In the context of increasing downward pressure on the economy, why the central bank dispelled the expectation of a RRR cut in the fourth quarter? The reasons behind it are worth exploring. In this regard, Jin Yi, an analyst at Guohai Securities, said that from the perspective of funding, there was no obvious funding gap in the fourth quarter, which was the direct cause of the failure of the RRR cut expectations. From a fundamental point of view, employment indicators have improved significantly, which may be the fundamental reason why the central bank’s RRR cut expectations have failed. Why did the economic data fall in the third quarter, but the employment situation improved? The key is the toughness of exports. In July, the epidemic broke out in Vietnam and other Southeast Asian regions, and export orders returned to China, thus absorbing a large number of employed people. From the perspective of the epidemic curve, the epidemic in Vietnam will ease in November, but Vietnam’s slow resumption of work will bring benefits to China’s exports, which may last until around the Spring Festival next year. Therefore, looking forward to the fourth quarter, China’s exports will continue to maintain resilience and promote the improvement of the job market, which may exceed market expectations and requires investors to pay close attention.

Previously, Sun Guofeng, Director of the Monetary Policy Department of the Central Bank, stated at a press conference on financial statistics in the third quarter that the supply and demand of liquidity in the banking system in the fourth quarter will continue to maintain a basic balance without major fluctuations. Regarding interim factors such as government bond issuance, tax payment, and maturity of medium-term lending facilities, the People’s Bank of China will comprehensively consider liquidity conditions and financial institution needs, and flexibly use various monetary policy tools such as medium-term lending facilities and open market operations. , Timely and appropriately release liquidity of different periods, smooth out short-term fluctuations, meet the reasonable funding needs of financial institutions, and maintain reasonable and sufficient liquidity.

Expectations of RRR cuts to fall to put pressure on the bond market

Ping An Securities analyst Liu Lu’s judgment on the pace of future monetary policy is that easing will begin at the end of the year at the earliest. However, judging from the recent market environment and policy stance, the central bank’s easing timing will only lag behind and it is difficult to advance. The specific reason is that the policy needs to solve the problem of “expansion” first, and then solve the problem of “stagnation”. PPI will remain at a high level during the year. With the recovery of offline consumption and rising international oil prices, the transmission of PPI to CPI may further manifest itself. Although the current price increase is not a monetary issue, the probability of the central bank tightening is not high, but the price increase will still affect the central bank’s Relaxed rhythm. Second, the market’s judgment that the economy is about to enter a recession may be premature.

Although the central bank continued to “release water” with large sums of money, as the end of the month was approaching, the fund still showed a trend of tightening. On October 27, the Shanghai interbank short-term inter-bank offered rate (Shibor) showed signs of raising, and the overnight Shibor rose by 27.5. A basis point, reported 1.921%, compared with the previous day, there was a significant increase in the day, but it needs to be reminded that the longer-term varieties performed relatively stable.

Exchange repurchase interest rates also rose accordingly. GC001 on the Shanghai Stock Exchange rose 10.5% to 2% to close at 2.21% on the same day, and GC002 rose 16.39% to 2.415%. Shenzhen Stock Exchange R-002 surged 52.2 BP on the day, closing at 2.152%. In addition, all types of inter-bank repurchase also increased. One-day repurchase DR001 rose by more than 30%, and as of the close, it was reported at 1.894%.

The expectation of wide currency, which supported the bullish sentiment in the early stage, has dropped sharply, and the bond market’s negative factors have become prominent. On the one hand, rising inflation concerns may restrict the expectation of wide currency. On the other hand, the central bank stated that the liquidity supply and demand situation in the fourth quarter is basically balanced and emphasizes the overall The use of various monetary policy tools such as MLF and open market operations to maintain reasonable and sufficient liquidity may also mean that the probability of short-term RRR cuts is greatly reduced. AVIC Securities analysts said that the bond market faces many negative factors, and it is still in an adjustment trend and should remain cautious.

(Author: Ye Maisui, Zhang Wanxue Editor: Li Yilin)


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