China's central bank curbs excess liquidity and withdraws 48 billion yuan ($7,92 billion) of funds from the market. The unexpected growth in credit in January put downward pressure on rates.
In this way, the People's Bank of China (Pboc) intends to gradually move the cost of money upwards to push companies to reduce their debt and discourage the high-risk activity of the so-called 'shadow banking'.
The sustained growth in credit at the start of the year poured funds into the system by increasing supply and pushing yesterday's weighted average rate on seven-day refinancing operations to 3,84%, its lowest since November.
Since June of last year, the central bank has not drained liquidity from the system but only injected short-term funds for limited periods of time, then allowing them to leave the system with the expiry of the repurchase agreements, within a few week.
