The People's Bank of China (PBOC), the country's central bank, starts a 600-billion-yuan (about 90 billion U.S. dollars) outright reverse repo operation on Monday to maintain ample liquidity in the banking system.

The operation has a fixed quantity and is carried out through interest-rate bidding, with winning bids determined at various price levels. It will have a tenor of six months, or 183 days, according to the central bank.

A total of 600 billion yuan of six-month outright reverse repos will mature in June. This implies that the central bank's new round of operation constitutes a rollover of the same amount, ending three consecutive months of reduced volume operations.

Outright reverse repo operations, a tool the central bank introduced in October 2024 to manage liquidity in the national banking system, are conducted each month with a tenor of no more than one year.

Under this mechanism, the central bank purchases bonds from primary dealers, such as large commercial banks, while agreeing on a future date for the dealers to repurchase the same quantity and type of bonds. This process effectively injects liquidity into the market.