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China's central bank will sell 80 billion yuan of three-month bills in its open market operation, up from 45 billion yuan of bills sold in the previous auction.
As the money market sees more liquidity, the demand for 3-month bills is also bouncing back. Even though the volume increased significantly, analysts say the yield will most likely keep flat for market stability.
As a total of 94 billion yuan in bills and repos are due to mature this week, the central bank appears set to conduct a net drain from the market, reversing the course from injections over the previous eight weeks.