The People's Bank of China injected 130 billion yuan ($19.9 billion) in short-term funds into the country's financial system overnight, according to a statement.
The People's Bank of China offered the funds in the form of what are known as seven-day reverse repos on Tuesday at an interest rate of 2.25%, according to the statement.
The action came, reports MarketWatch, after the PBOC on Monday opted not to renew a credit line of the same amount to China Development Bank, a major policy bank, in the belief that market liquidity had remained ample.
Chinese stocks dropped 7% Monday, triggering a halt to trading and leading to a global selloff. On Tuesday morning the Shanghai stock market's main benchmark index was up 0.3%.
We are pretty much in a period of near global monetary inflation.
There is no way this doesn't end with eventual accelerated near global price inflation.
-RW
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