China's central bank renewed its cash injection via open market operations to ease liquidity on Tuesday after suspending the move for two trading days.

The People's Bank of China (PBOC) conducted 190 billion yuan (about 27.6billion U.S. dollars) of reverse repos, a process by which the central bank purchases securities from banks through bidding, with an agreement to sell them back in the future.

The injection saw a net 170 billion yuan in cash pumped into the market on Tuesday, offset by 20 billion yuan in maturing reverse repos.

The operations included 150 billion yuan of seven-day reverse repos priced to yield 2.45 percent, and 40 billion yuan of 14-day contracts with a yield of 2.6 percent, according to a central bank statement.

The money market, however, still saw a slight net cash withdrawal on Tuesday as 179.5 billion yuan of medium-term lending facility (MLF) matured.

The MLF tool was first introduced in 2014 to help commercial and policy banks maintain liquidity by allowing them to borrow from the central bank by using securities as collateral.

China (FXI, quote) set the tune of its monetary policy in 2017 as prudent and neutral, keeping an appropriate liquidity level but also avoiding excessive liquidity injections.

Content Curiosity of China.org.cn