China’s central bank drained a net 1.14 trillion yuan ($166 billion) of liquidity in March via short- and long-term tools, marking its first net withdrawal in about a year and likely the first net repayment of PBOC loans by banks since May, based on calculations. The move reverses months of injections as growth improves and rising oil prices add inflation pressure. Despite the drain, interbank rates held near 1.3%, indicating stable conditions, with the PBOC maintaining a “moderately loose” stan

China’s central bank drained a net 1.14 trillion yuan ($166 billion) of liquidity in March via short- and long-term tools, marking its first net withdrawal in about a year and likely the first net repayment of PBOC loans by banks since May, based on calculations. The move reverses months of injections as growth improves and rising oil prices add inflation pressure. Despite the drain, interbank rates held near 1.3%, indicating stable conditions, with the PBOC maintaining a “moderately loose” stance while turning more cautious on stimulus. Analysts including Lynn Song of ING, Serena Zhou of Mizuho Securities and Michelle Lam of Societe Generale said easing expectations may be delayed, though some still see potential rate and reserve ratio cuts later this year.