The People’s Bank of China (PBOC) has pumped another CNY 50bn ($8.1bn) of short term loans into the country’s banking system.
The three-month loans were issued to mid- and small-sized joint-stock commercial banks, and city and rural commercial banks.
The money has been injected into banks at a discounted rate so that the funds can be re-lent to farmers and small businesses.
The loan injection was executed through the medium-term lending facility, which is a policy tool created last year to inject cash into banks to keep short-term interest rates low.
The loans were dispensed at an interest rate of 3.5% to keep money market rates stable before the Lunar New Year holiday, with a benchmark one-year lending rate of 5.6%.
Additionally, the central bank also rolled over CNY269.5bn worth of similar loans that have expired.