BEIJING, March 12 (Xinhua) -- Altogether 390 billion yuan (about 56.4 billion U.S. dollars) of reverse repo contracts are set to mature this week after China's central bank continued to drain money from the market.
No repos or central bank bills are set to mature from March 13 to March 17, according to Wind, an information service provider.
For the central bank, a repo, or repurchase agreement, is the sale of securities to banks tied to an agreement to purchase the securities back in the future. A reverse repo is the purchase of a security to be sold back later.
In the past week, contracts worth 210 billion yuan matured, while the central bank conducted 100 billion yuan of reverse repos, effectively draining 110 billion yuan from the market.
The People's Bank of China continued to withdraw money via open market operations on Friday, when it suspended reverse repo operations and saw a net 20 billion yuan drained from the market.
It suspended cash injections by conducting reverse repos on Thursday for the first time since restarting the operation on Feb. 13.
The halts were aimed at keeping liquidity in the banking system stable in light of multiple liquidity-boosting factors in the near term, according to the central bank's online statements.
As of March 10, 12 consecutive trading days of net withdrawals saw 450 billion yuan drained from the market.
According to the government work report delivered at the annual parliamentary session, China will pursue a prudent and neutral monetary policy in 2017, with the M2 money supply to grow by around 12 percent, one percentage point lower than the 2016 target. In 2016, the M2 money supply increased by 11.3 percent, according to the report.
The government will apply a full range of monetary policy instruments, maintain basic stability in liquidity, ensure market interest rates remain at an appropriate level and improve the transmission of monetary policy.