On August 22, the central bank took action!

The People's Bank of China announced that on August 25, it will carry out a 600 billion yuan one-year MLF (medium-term lending facility) operation, using the method of "fixed quantity, interest rate bidding, and multiple price winning bids". To put it simply, the central bank is going to "refuel" the banking system.

And this month, 300 billion yuan of MLF expired, so after this operation, a net investment of 300 billion yuan was achieved - equivalent to "sending 300 billion medium and long-term funds to the market" for free.

Why is this operation worth paying attention to?

Continuous increase to release a clear easing signal. This is not a "temporary emergency", but a continuation of MLF for the sixth consecutive month. It shows that the central bank is consciously injecting medium and long-term liquidity into the banking system and maintaining loose funds.

The word "stability" is at the forefront, and the real economy is cared for. At present, the economy is still in the recovery stage, and a stable capital environment is needed for corporate financing and government bond issuance. The central bank ensures that banks "have water to lend" through MLF net investment to support credit delivery and economic recovery.

Interest rates are likely to remain unchanged, focusing on the support of "quantity". Although the interest rate was not mentioned this time, the market generally expects the MLF interest rate to remain unchanged. This means that the policy focus is not on "interest rate cuts", but on "stable growth + easy credit".

"Quietly added a tank of oil" to the financial system

Do you think the net investment of 300 billion MLF on August 25 will be over? No, the central bank's operation this month can be called "hiding a needle in the cotton". In addition to the MLF increase of 300 billion yuan that we just talked about, the central bank also quietly used a "new tool" in August - buyout reverse repurchase, and it was twice

August 8: 600 billion yuan

August 15: Another 600 billion yuan

Although 1.1 trillion yuan expired during the period, it still achieved a net investment of 300 billion yuan in the end. In other words, throughout August, the central bank has invested a total of 600 billion yuan in medium and long-term funds through MLF + buyout reverse repurchase.

This is equivalent to "quietly adding a tank of oil" to the financial system.

Why do we continue to "release water" at this stage?

From June to August, medium-term liquidity continued to be in a state of net investment, especially in August, MLF + buyout reverse repurchase two-pronged approach, with a net investment of 600 billion yuan in a single month, which has expanded significantly. This is not accidental, but a "premeditated" cooperation. There are three logics behind it, I will break it open and crush it for you.

Why do we continue to "release water" at this stage? Three key words:

1. Fiscal bond issuance + credit development = not enough money

What time is it? Peak period of government bond issuance: special treasury bonds and local bonds are intensively landed, and trillions of funds need to be issued, and the market needs to "catch it". Regulators call for "increased credit delivery": banks must have money to lend to support enterprises and stabilize real estate.

Where does the money come from? The central bank uses MLF and buyout reverse repo tools to "transfuse" the banking system to ensure that the two lines of finance and finance are not disconnected. This is called: fiscal force, monetary escort.

2. Market interest rates have quietly risen, and the central bank has taken action to "put out the fire"

You may have noticed lately that medium- and long-term market interest rates (such as 10-year Treasury bonds) have quietly risen. Why? The stock market is picking up, and funds are diverted; Policy expectations such as "anti-involution" have heated up, and economic optimism has rebounded; The marginal tightening of interbank liquidity. As soon as interest rates rise, corporate financing costs are under great pressure. The central bank took a look: No, it has to be stabilized! Therefore, we will increase the investment of funds in the medium term, suppress interest rates, stabilize expectations, and do not let "expensive money" drag down economic recovery.

3. Release signal: monetary policy is still in "support mode"

Many people think that the economy is stable and improving in the first half of the year, and the policy should be "collected". But the central bank said with action: Don't rush, continue to hold on. The continued net liquidity injection in the medium term is sending a clear signal: quantitative instruments are still strengthening, and monetary policy still maintains a supportive stance. It is not flood irrigation, but "precise drip irrigation + paving the way in advance".

It is becoming clearer that the central bank is not "bailing out the market", but "paving the way". Instead of pursuing short-term stimulus, it creates a stable, low-cost financing environment for economic recovery. This kind of "moisturizing and silent" operation is often more effective and sustainable than cutting interest rates.