3-year central votes to increase prices rise

Xinhua Beijing April 22:3-year central votes again "increase price rise" reporter Huayadi, Shen Mo People's Bank of China 22nd in the open market tender issued 90 billion yuan 3-year central vote, this is 3-year central vote since April 8 restart since the two-degree issue, circulation is the last 6 times times, while,　　The price of the issue rose unexpectedly: the interest rate set by the bid was reduced by 1 basis points to 2.74%.　　Hongyuan Securities Senior Researcher He Yi analysis that the 3-year central vote issued "increase price rise", on the one hand, highlighting the liquidity of the return pressure is still large, on the other hand reflects the market institutions for the 3-year central vote demand is very strong. Reporters found that the industry generally believe that the liquidity of the withdrawal pressure is still large. Guo Qin, an analyst at Citic Securities, said that despite the March trade deficit, foreign exchange reserves continued to grow, coupled with hot money inflows, have increased the open market to return pressure.　　Data show that the first 3 months of this year, China's foreign exchange reserves increased by 16.1 billion U.S. dollars, 9.4 billion U.S. dollars and 22.5 billion U.S. dollars.　　However, in the past few weeks the central bank net withdrawal strength has been significantly reduced: from the two weeks after March, 213 billion yuan, 218 billion yuan gradually fell to April before two weeks of 163 billion yuan, 110 billion yuan, and then steep to 14 billion yuan last week, once prompted the market for the reserve ratio to increase the expected rise.　　Xu Xiaoqing, executive general manager of the fixed income division of CICC, believes that the gradual decline in net returns is a return to normalization of returns, the 3-year central votes issued volume, resulting in net return again, conducive to stabilizing market sentiment.　　The same day, the central bank also in the open market tender issued 23 billion yuan March, the circulation was significantly reduced by 45 billion yuan last week, and carried out a 35 billion yuan repurchase operation, thus, this week to achieve a net return of 65 billion yuan, much higher than last week's 14 billion yuan.　　To their surprise, the 3-year central-issue rate was dropped 1 points to 2.74% on the day of the tender, after the market generally expected the 3-year central issue rate will be equal to 2.75%. "The drop in prices underscores the demand for 3-year central votes for market institutions.　　"He said that the current 3-year central votes yield ratio of 1 years higher than nearly 80 basis points, at an all-time high."　　A large Shanghai state-owned bank trader has confirmed to reporters that the bank's current configuration needs are strong and that the 3-year central-vote yield is attractive, and that another city commercial bank trader has been candid about accepting even higher prices, such as low yields of 2.73%. Market participants here commented that the increase in the price is mainly due to market demand, open market operations are usually reported by a first-tier dealers demand, the central bank in accordance with the demand situation to determine the circulation and issuance of interest rates; In addition, to some extent, the central bank intends to let the 3-year issue of the market more　　Easy to improve the open market operations targeted. Another concern is that open market operations show "short-term" signs of "long-term". Data show that the 1-year central vote circulation has been from 3The 100 billion yuan in the middle of the month fell to the recent $40 billion, while the March issue of the central vote returned from 160 billion yuan in late March to 23 billion yuan this week, in stark contrast to the 3-year central vote from 15 billion to 90 billion. What is the peak that the open market operation "growth period" "shortened period", prominent institutions for the 3-year central vote preference for more than a short period of variety, 3-year central votes are expected to play a greater role in the recovery of liquidity; Li Huiding Securities senior analyst, said that the 3-year central vote is very attractive,　　Future open market operations may be biased towards a 3-year central vote.　　Li Huiding also cautioned that, as the 3-year central vote can play a significant role in the withdrawal, with the increase in the withdrawal, its tightening of marginal effect on the capital of the accumulation of qualitative changes will gradually release, the future does not exclude the market funds face tightening expected to emerge again. It is noteworthy that market participants here also revealed that the 3-year central vote of 90 billion yuan is less than the total demand reported by previous market institutions, which may also reflect the concern of the regulator for a more significant increase in the 3-year issue, after all, with a long shrinking capital cycle and weaker flexibility, And the signal is stronger.