China’s central bank has conducted its first treasury bond trade in nearly two decades in open markets, debuting a long-awaited monetary tool to help manage the domestic bond market and stabilise the economy.
In an online statement published Friday afternoon, the People’s Bank of China said it bought short-term treasury bonds from primary dealers and sold long-term bonds – a net purchase of 100 billion yuan (US$14.1 billion) – to “fulfil requirements set out at the central financial work conference” in October.
The move follows comments from bank governor Pan Gongsheng over the necessity of “incremental policies” as a means of steadying the national economy during interviews with state media and an address at a recent symposium.
“We must take a supportive monetary policy stance, enhance countercyclical adjustments and increase financial support for the real economy through a variety of policy tools,” Pan said to an…
