OMO turns to confirm that there is no worries about short-term funds

After breaking the continuous net release on the previous day, on the 2nd, the central bank's open market operation (OMO) further turned to a net return, the first net return for the last three weeks. Market participants said that the central bank's adjustment of open market operations has confirmed that the short-term liquidity supply and demand pressure has eased, and the funding situation has improved significantly. In view of the lack of liquidity at the beginning of the month, even if the central bank continues to suspend reverse repurchase operations, short-term capital fabrics are basically Innocent.

The first net return in three weeks

On November 2nd, the central bank did not carry out open market operations, and the expiration of 140 billion yuan reverse repurchase realized a natural net return. This is the first net return since October 13.

The central bank carried out a large-scale net investment in October. According to statistics, in October, the central bank realized a total of 262.80 billion yuan of funds through reverse repurchase and MLF operations, achieving a net investment of 888.5 billion yuan. In the same month, the central bank only conducted three net withdrawals in the first half of the month, and from October 13 to the continuous net delivery.

However, just after October, there was an adjustment in the open market operation on November 1. On the same day, the central bank launched a 240 billion yuan reverse repurchase operation, and the amount of hedging dues was broken, which broke the momentum of the previous continuous net release.

According to industry insiders, the central bank has continued to “cut the peaks and fill the valley” for liquidity this year, showing the reverse regulation of neutrality. In the face of temporary liquidity shortage, the central bank has timely and appropriate liquidity, in case of excessive liquidity. , hedge against reverse repurchase, etc., to ensure that liquidity is at a basically stable, moderately moderate level. At the beginning of November, the central bank's open market operations shifted from net delivery to net return, which just indicated that short-term liquidity stability demand fell.

The central bank announced that at the end of last month, the fiscal centralized expenditures pushed the total liquidity of the banking system at a relatively high level, which could absorb the influence of the central bank's reverse repurchase due and other factors. Therefore, the open market operation will not be carried out on November 2.

Keep your money loose

On the 2nd, the market funds remained on the loose side of the previous day and were not affected by the net withdrawal of OMO.

An intermediary said that in the inter-bank repurchase market yesterday, there was a large amount of overnight financing in the early morning, and the demand for various types of institutions was quickly met. The 7-day and 14-day financial funds increased, and interest rates continued to fall. There are not many transactions in the period of more than one month, and the organization has demand for the funds for the New Year, but the difference in the price of the orders is very different. The easing of funds has been maintained until the close.

A bank trader also said that the market funds were loose all day, the short-term capital supply was abundant in the morning, the price was lower, and the market was more relaxed in the afternoon. The overnight fund price fell from the weighted nearby to the minus point. On the whole, the short-term liquidity improvement is more obvious, and the capital price is down more, but the cross-year capital price is still high.

On the 2nd, bond repurchasing in the interbank market went down across the board, and the downside was larger. Among them, the overnight repo rate (DR001) fell 17BP to 2.56%, the representative 7-day repo rate (DR007) fell nearly 10BP to 2.84%, and the longer-term 1 to 3 months varieties also have a certain decline.

Analysts said that as the effect of the end of the month subsided, the cumulative effect of fiscal centralization expenditure at the end of October and the net investment of the central bank in the early period began to appear, and the funding surface showed a significant improvement. In the short-term, the peak of the reverse repurchase has passed, and the central bank will proactively continue to make full progress on the MLF. In the first half of the month, there are not many liquidity disturbance factors, and the funds are expected to remain stable and loose. However, he also suggested that the central bank or the phased suspension of the reverse repurchase operation will restrict the funds to continue to loosen, and enter the second half of the month. As the tax payment factor re-emerges, and the year-end effect may gradually appear, it is expected that the funds will reconverge and the future will be presented. Tight balance is still a high probability event.