China's central bank pumps more money into market

TOKYO, Aug 27 (KUNA) -- China's central bank on Thursday pumped more money into the market to ease liquidity strain, state-run Xinhua News Agency reported. The People's Bank of China conducted CNY 150 billion (USD 23.4 billion) of seven-day reverse repurchase agreements, a process in which central banks purchase securities from banks with an agreement to resell them in the future. Liquidity in the money market has tightened due to dropping new yuan funds outstanding for foreign exchange and a depreciating Chinese yuan. Following the cash injection, in Thursday's interbank market, the benchmark overnight Shanghai Interbank Offered Rate, which measures the cost at which Chinese banks lend to one other, dropped by 2.7 basis points to 1.759 percent. The move comes a day after the central bank cut its benchmark interest rates on Wednesday amid growing fears of a slowdown in the world's second-largest economy, which has triggered plunges in the global stock markets. (end) mk.rk