PBoC: Rates raised on open market operations by 10bps on 7, 14 and 28 day reverse repos - TDS

Research Team at TDS notes that the PBoC raised rates on its open market operations by 10bps on 7, 14 and 28 day reverse repos and followed an increase of 10bps at the beginning of Feb.

Key Quotes

“The PBoC also increased the cost of funds lent via the MLF by 10bps as well to 3.05% and 3.2% for 6m and 1yr rates respectively. The PBoC advised against over-interpreting the move as an interest rate hike, pointing to strong market expectations of higher borrowing costs. The decision to lift rates shortly after the Fed should help to deflect criticism that China’s policy peg to the US is diminishing.”