March issue of the circulation of the central vote again low this week to achieve net release

Liulanchang May 27, the People's Bank of China bid to issue 5 billion yuan three-month central votes, circulation in the last week hit a 10-month low after a 20% reduction.　　However, the three-month central-issue yield was expected to be flat this week after an unexpectedly high return last week, and this week the open market is expected to achieve a net release. The central bank will issue its 44th Central Bank bill this year (May 27) To keep the base currency steady and the money market rates generally stable, according to the central bank's website.　　The three-month (91-day) Bill, with a circulation of $5 billion, was further reduced by 1 billion yuan in Thursday, a new low this year.　　The open market this week as much as 180 billion yuan, and this Tuesday only issued 30 billion yuan one-year central vote, the same day did not carry out a positive repurchase operation, so even in Thursday, the bank to carry out a positive repurchase operation, the return of funds can not exceed the amount of funds due, this week will be again net　　The central bank's open market last week net withdrawal of 51 billion yuan, in addition to the previous week due to the deposit reserve contribution (more than 300 billion yuan frozen funds) once a net investment of 152 billion yuan, the central bank previously 11 weeks net return of more than 1.1 trillion.　　"The resumption of liquidity is expected to happen," said a brokerage bond trader, the market is now very tight funds, if the central bank is not in the open market net, will only aggravate the market tension.　　In the past week, the interbank money market has become more and more tense, short-term interest rate indicators-the seven-day pledge-type repo weighted average interest rate of the latest quotation is 2.2066%, compared with the 1.9472% rise in the last day 25.9 basis; "Now everyone is short of money, the repo rate has been above 2%, the previous period is only 1.5%."　　Said the trader. Last week, the unexpected rise in the three-month central-vote yield sparked an expected increase in the market for one-year varieties.　　But this week the central bank issued 30 billion yuan a year in the open market, although it was 10 billion yuan more than last week, but the yield did not rise, but firmly locked in 1.9264%, for 18 consecutive weeks unchanged. The result does contain a strong rise in interest rates for short-term bonds.　　The same day, the one-year central vote two-level market interest rates, down 1 basis points down to 2.03%, the recent rally the most fierce three-month central votes were cut 2 basis points. A trader believes that with the current tightening of funds and the accelerated rise in coupon rates, the central bank is using it to convey the intent of the stabilisation market, so it is expected that this week's three-month issue of the yield will not continue to rise.