China's Central Bank Bought Net CNY200 Billion of Treasury Bonds in September

China's central bank said Monday that it bought a net 200 billion yuan ($28.52 billion) of treasury bonds in September, marking a second consecutive month of purchases it said would replenish liquidity in the financial system.

The People's Bank of China said in a brief statement that the purchases were aimed at stepping up the counter-cyclical adjustment of monetary policy and maintaining reasonable liquidity in the banking system.

In August, the PBOC bought a net 100 billion yuan of treasury bonds.

China's central bank has been warning market participants about the financial risks of a recent surge in treasury bond prices, which has driven down yields. It said it had hundreds of billions of yuan worth of bonds at its disposal via agreements with commercial banks, and would sell them depending on the market situation.

China's bond yields rebounded from historic lows last week after the PBOC introduced a bundle of stimulus measures that propped up the nation's stock markets, pulling capital away from the bond market and toward stocks.

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September 30, 2024 06:23 ET (10:23 GMT)

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