PBOC Injects Up to 544.8B Yuan at 1.40%, Drains Net Liquidity, Adjusts USD/CNY Reference Rate

The People's Bank of China (PBOC) has conducted a series of open market operations involving 7-day reverse repos at a consistent interest rate of 1.40% over several days in early August 2025. On August 4, the PBOC injected 544.8 billion yuan via 7-day reverse repos, maintaining the previous rate, but recorded a net drain of 49 billion yuan in overall open market operations. The USD/CNY reference rate was fixed at 7.1395, slightly lower than the previous fix of 7.1496. On August 5, the PBOC injected 160.7 billion yuan at the same rate but drained a net 288.5 billion yuan, with the USD/CNY reference rate adjusting to 7.1366 from 7.1395. On August 6, the injection amount was 138.5 billion yuan, with a net drain of 170.5 billion yuan, and the USD/CNY reference rate was fixed at 7.1409. On August 7, the PBOC again injected 160.7 billion yuan at 1.40%, draining a net 122.5 billion yuan, and set the USD/CNY reference rate at 7.1345, down from 7.1409 the previous day. Throughout this period, the PBOC maintained the 7-day reverse repo rate steady at 1.40%, while the net liquidity impact fluctuated between injections and drains, and the USD/CNY reference rate showed minor daily adjustments.