SHANGHAI, Dec 19 (Reuters) - The People's Bank of China said
it has injected funds into the interbank market through
short-term liquidity operations (SLO), but did not specify how
much, as regulators moved to calm a market panic that has pushed
short-term money rates to record highs.
The announcement, posted on the PBOC's official microblog
feed on Thursday, followed the extension of trading hours from
4:30 p.m. to 5 p.m. (0830-0900 GMT) in the interbank market,
after the benchmark seven-day bond repurchase rate
nearly crossed 10 percent at one point in intraday trade, its
highest quoted rate since a cash crunch in late June.
The one-year IRS based on the seven-day repo rose more than
4 percent to close at 4.97 percent, a historic high.
The rate rise followed a decision by the central bank to
abstain from open market operations for the fifth consecutive
session on Thursday morning, even after rates shot up Wednesday
as traders scrambled for cash.
SLOs are usually conducted behind closed doors with
individual banks who are short on funds.
The announcement did not say which bank or banks received
the funds injected, how much was injected, or when.
Traders said earlier in the day they heard an SLO had been
conducted with a major state-owned bank on Wednesday, but were
unable to confirm.
(Reporting by Pete Sweeney; Editing by Jacqueline Wong)
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