The People’s Bank of China announced it had conducted a short-term liquidity operation (SLO) to provide credit to banks after a surge on Thursday in interbank rates, Financial Times reported. The move was highly unusual because, according to the bank’s rules, SLOs are announced a month after the operation. Thursday’s cash injection was an attempt to prevent a repeat of the cash crunch that rattled global markets in June. The immediate announcement, made over the central bank’s mirco blog account, signalled its willingness to calm investors at the expense of breaking its own rules.
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