PBoC will conduct overnight reverse repos from October 21st to November 2nd via fixed-rate, quantity-based tenders, capped at CNY 1tln daily, and will include foreign-invested RMB settlement banks among eligible counterparties

PBoC will conduct overnight reverse repos from October 21st to November 2nd via fixed-rate, quantity-based tenders, capped at CNY 1tln daily, and will include foreign-invested RMB settlement banks among eligible counterparties.

Standing overnight reverse repo windows of this kind sit at the fine-tuning end of the PBoC toolkit, below the seven-day reverse repo that has served as the operational policy anchor; historically the Bank has layered short-dated operations on top of its core tenor around month-end and tax-payment squeezes, and the stated window here spans the turn of the month, which is the classic trigger. The fixed-rate, quantity-based format matters: it converts the operation from price discovery into a standing facility at an administered rate, a structure the PBoC has used when it wants to cap money-market rates rather than test where they clear. A CNY 1tln daily cap is best read as a ceiling rather than a target; in past episodes uptake against such caps has been the tell, with heavy subscription signalling genuine funding stress and thin usage signalling the facility is functioning as a backstop. The inclusion of foreign-invested RMB settlement banks among eligible counterparties is the structural element: widening access to onshore liquidity has on previous occasions been part of the incremental opening of the RMB funding channel rather than a response to conditions, and it sits alongside earlier steps to admit a broader range of institutions to PBoC operations. Follow-ons worth noting are the rate at which the overnight facility is priced relative to the prevailing short-end, actual daily subscription versus the cap, and whether the counterparty expansion extends to other operation tenors.