SHANGHAI (Reuters) – China’s central bank will conduct medium-term lending facility (MLF) operations on Thursday, two traders with direct knowledge of the matter said.
A batch of 200 billion yuan ($28.20 billion) worth of one-year MLF loans is due to expire on the day.
Markets will closely monitor the interest rate on the fresh MLF loan injection to gauge the People’s Bank of China’s (PBOC) monetary policy stance.
The MLF now acts as a guide for the PBOC’s new lending benchmark Loan Prime Rate (LPR).
The one-year MLF rate <CNMLF1YRRP=PBOC> now stands at 2.95%.
(Reporting by Zhang Xiaochong and Andrew Galbraith, Writing by Winni Zhou; Editing by Shri Navaratnam)