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Central Bank Injects Net $3.5 Billion Into Financial System

By Zhao Runhua and Lin Jinbing / May 14, 2019 12:50 PM / Finance

Photo: VCG

Photo: VCG

China’s central bank issued 200 billion yuan ($29.1 billion) of medium-term lending facility (MLF) loans on Tuesday, the bank said in a statement. The amount is 24 billion yuan more than the combined 176 billion yuan of MLF loans and reverse repo due on the same day.

On Wednesday, the People’s Bank of China will cut its reserve requirement, the amount of cash banks must keep in reserve, for some small and midsize locally focused lenders. The move is expected to unleash 280 billion yuan of long-term funds into the market. It’s widely seen as a measure to support the economy as external uncertainties increase, especially when China-U.S. trade tensions have been escalating.

Related: Central Bank to Cut Reserve Requirement Ratio for Smaller Locally Focused Lenders

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