On October 27, 2026, the weighted average interest rate of DR007 closed at 1.35%, while the weighted average interest rate of DR001 slightly decreased to 1.2775%, and further declined in early trading today. The central bank injected a net 151 billion yuan into the market today.
-------- Note: 1. Short-term money market interest rates such as DR001 and DR007 reflect the adequacy of market liquidity. Besides loan rates for the real economy, many transactions in financial markets such as the stock and bond markets are essentially leveraged through loans, and the cost of these loans depends on short-term funding rates.
2. The gap between DR007 and the central bank's 7-day reverse repo rate (policy rate) is a key focus of market attention. If the DR007 rate is significantly higher than the policy rate, it indicates a shortage of funds in the market, and the central bank may intervene to inject liquidity; conversely, it indicates very ample market liquidity.
3. In October 2026, the People's Bank of China announced that it would change the policy rate to overnight reverse repo at an opportune time. This means that DR001 is expected to become the anchor of China's short-term interest rate, and the difference between DR001 and the overnight reverse repo rate may become an indicator of market liquidity.
