Liquidity in China’s money markets is likely to remain tight before the Spring Festival as the central bank has conducted no open market operations since the start of the year, the China Securities Journal reported Wednesday, citing analysts. Requirements on cash provisions during the holiday will also contribute to the liquidity crunch. Ling Ping, chief economist of Bank of Communications Co. Ltd. (03328.HK, 601328.CN), was quoted as saying that the accelerated interest rate liberalization this year will aggravate liquidity. Meanwhile, the plan to float the deposit rate is expected to be launched at an appropriate time this year, the report said.
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