BEIJING, March 24 (Xinhua) -- The People's Bank of China, the country's central bank, refrained from offering reverse repos for the 26th straight day on Tuesday as the liquidity condition eased after targeted reserve requirement ratio (RRR) cuts for eligible banks.

No reverse repos matured Tuesday.

A reverse repo is a process in which the central bank purchases securities from commercial banks through bidding, with an agreement to sell them back in the future.

Facing potential economic shocks from the novel coronavirus outbreak, China's financial authorities pledged to to pay more attention to policy flexibility to keep reasonably sufficient liquidity and release the potential of the loan prime rate reform.

Starting March 16, China's central bank implemented targeted reserve requirement ratio (RRR) cuts for eligible banks, the second such cuts this year, which would release another 550 billion yuan (about 77.4 billion U.S. dollars) of liquidity into the market.

On the same day, the PBOC pumped a total of 100 billion yuan into the financial system via the medium-term lending facility (MLF).

"Following the liquidity injections, the interest rates in the monetary market was at a low level and the urgency for further easing had been reduced," Li Zhan, chief economist with Zhongshan Securities, told Securities Daily.

Chen Yulu, vice governor of the People's Bank of China, said at a press conference over the weekend that China's financial market has withstood the external shocks and remained highly stable, stressing that the Chinese government has ample policy space and tools to deal with the impact.

Investment bank China International Capital Corporation Limited (CICC) said in a research note that it expects another 40 basis points of loan prime rate (LPR) cut, 150 basis points more in RRR cuts as well as 5 basis points of benchmark deposit rate cut in the remainder of 2020. Enditem

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