BEIJING — China’s central bank injected a net 20 billion yuan (about $3 billion) into the market via open market operations on Nov 20 to ease the liquidity strain.

The People’s Bank of China (PBOC) conducted 100 billion yuan of reverse repos Nov 20, pumping a net 20 billion yuan into the market as 80 billion yuan of reverse repos matured.

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

On Nov 20, the PBOC conducted 70 billion yuan of seven-day reverse repos priced to yield 2.45 percent, 20 billion yuan of 14-day contracts with a yield of 2.6 percent, and 10 billion yuan of 63-day contracts with a yield of 2.9 percent.

Despite the injection Nov 20, the overnight Shanghai Interbank Offered Rate (Shibor), which measures the cost at which banks lend to one another, rose 4.8 basis points to 2.786 percent on Nov 20.

Since last week, the central bank has injected more funds into the market as maturing reverse repos and due tax payments put pressure on liquidity near the end of the year.

The central bank injected a net 621 billion yuan into the market via open market operations last week to ease the liquidity strain, the largest amount in nearly 10 months.

The central bank has increasingly relied on open market operations for liquidity management, rather than cuts in interest rates or reserve requirement ratios.

China set the tone of its 2017 monetary policy as prudent and neutral, keeping appropriate liquidity levels but avoiding excessive liquidity injections.

Such a policy stance is crucial for China as it has to juggle the task of financial deleveraging, aimed at defusing risk and curbing asset bubbles, while shoring up the economy.