Sino-Singapore Jingwei Client, August 12th. On the 12th, the central bank launched a 140 billion yuan reverse repurchase operation. So far, the central bank has carried out reverse repurchase for four consecutive working days, and has accumulated a total of 190 billion yuan in liquidity.

　　Source: Central Bank's official website

　　The central bank announced that on August 12, 2020, the central bank conducted a 140 billion yuan reverse repurchase operation by way of interest rate bidding, with a period of 7 days, and the winning interest rate was 2.20%, the same as the previous time.

　　The central bank’s previous information showed that after the suspension of reverse repurchase for four days, the central bank restarted reverse repurchase on August 7. The reverse repurchase won the bid amount of 10 billion yuan on that day, due to the 7-day reverse repurchase carried out on July 31. The purchase expired, and a net return of 10 billion yuan was made on August 7. Thereafter, the central bank carried out reverse repurchase of 10 billion yuan and 50 billion yuan on August 10 and 11 respectively.

　　Source: Wind

　　According to Wind data, as of August 12, the central bank has carried out reverse repurchase for four consecutive working days, with a cumulative net liquidity of 190 billion yuan.

　　The China Securities Journal said on the 12th that the approaching tax period and the issuance of government bonds are the two major disturbances to liquidity this week. The deadline for tax payment this month is August 17. As the tax payment deadline approaches, liquidity will be further tightened without being replenished.

　　The Political Commissar Lu, chief economist of the Industrial Bank, pointed out that since 2015, the open market reverse repurchase operation has been one of the central bank's most important short-term liquidity investment tools, and its operation history has shown obvious seasonal characteristics. From the perspective of intra-month rhythm, reverse repurchase "mid-month increase, end of month or early next month empty window" is a general pattern. In terms of quarterly rules, reverse repurchase operations are generally expressed as "net withdrawal in the first and third quarters, and net investment in the second and fourth quarters".

　　The Lu political commissar team stated that there were some new changes in reverse repurchase operations in the first half of 2020. The scale and frequency of reverse repurchase have declined compared with the same period in previous years. Except for the previous central bank’s RRR cut and increase of re-lending and rediscount lines to supplement the liquidity of banks, the increase in fiscal expenditure or reverse repurchase seasonality One of the important reasons for the weakening of the law. Looking ahead, with the gradual withdrawal of monetary policy towards normalization, government bonds and local bonds that were delayed in the previous period will be issued one after another, and reverse repurchase operations may return to the seasonal "normality" of previous years.

　　The Jin Yi team of Guohai Securities believes that it is difficult to effectively alleviate the pressure on long-term funds based on open market operations alone. Overlapping the second quarter over-reserve rate fell sharply compared with the first quarter, and the volatility of funds increased. The possibility of hedging RRR cuts in September increased. The central bank continued to emphasize the importance of structural tools in the second quarter monetary policy implementation report, and there is also the possibility of lowering the refinancing rate.

　　According to the central bank’s news, regarding the focus of the central bank’s work in the second half of the year, the governor of the central bank, Yi Gang, said in an exclusive interview that the central bank will focus on supply-side structural reforms, do a solid job of "six stability" and fully implement the "six guarantees" task. Maintain a moderate and reasonable growth of financial aggregates, focus on stabilizing enterprises to ensure employment, prevent and resolve major financial risks, accelerate the deepening of financial reform and opening up, and promote the healthy development of the economy and finance. (Zhongxin Jingwei APP)