Original Title: Maintaining Stability Liquidity, the Central Bank’s Equal Parity Renewal of 200 billion MLF
On the 15th, the central bank launched a 200 billion 1-year mid-term loan facility (MLF) operation (including the renewal of the MLF maturity on June 15) and a 10 billion 7-day reverse repurchase operation. The winning interest rate was 2.95%, 2.20%. Wind data shows that on the 15th, there were 20 billion yuan reverse repurchase and 200 billion yuan MLF expired.
In terms of funding, most short-end Shibor varieties rose on Tuesday. Overnight varieties reported 10.6bp up at 2.104%, 7-day up 6.8bp reported 2.237%, 14-day up 4.4bp reported 2.246%, 1-month down 0.1bp reported 2.383%. Some traders said that the price of funds has risen, but the supply is acceptable. There is no obvious pressure in the short-term. The central bank’s MLF parity continues to show a steady trend. The end of the year is approaching and the focus is still on further changes in liquidity.
Treasury bond futures fluctuated within a narrow range and closed slightly, and the yields of major inter-bank interest-rate bonds declined slightly; the overall balance of funds in the inter-bank market was broad, and the major repurchase rates rose slightly. The above-mentioned traders said that MLF will continue to do the same without suspense, and the policy will continue to release signals of firm stability.
June has always been a month for capital demand, and it is expected that the central bank will still guarantee a sufficient supply of liquidity. Last week, the open market operations had a large amount of maturity. In addition to the 500 billion yuan MLF, there were also 280 billion yuan reverse repurchase maturities. In addition, 240 billion yuan of MLF expired on June 19, plus the reverse repurchase that expired recently, a total of more than one trillion yuan of open market operations expired in June.
Wang Qing, chief macro analyst at Oriental Jincheng, said that in June, the MLF maintains the same sequel, which reflects the central bank’s adherence to the stable position of monetary policy in the context of rapid economic recovery and high PPI. It aims to stabilize market expectations and promote A comprehensive balance is reached between economic restoration and prevention of various risks.
Tianfeng Securities believes that June is in the window of funding and financial stability, and financial stability enjoys a higher weight in policy objectives. The central bank’s failure to increase investment means that the liquidity gap is not yet obvious.
It is worth noting that the U.S. CPI announced on June 10 rose 5% year-on-year, setting a new high in the past 13 years. The market expects that the Federal Reserve may tighten its monetary policy.
This week the Federal Reserve Open Market Committee opened a two-day interest rate meeting and will announce the interest rate resolution on Wednesday. Investors waited with bated breath for whether the Fed will release a signal of tightening.