The People's Bank of China announced that it will launch a 200 million yuan 7-day reverse repurchase operation on June 2, with a bid volume of 200 million yuan and a medium amount of 200 million yuan. The operating interest rate is 1.40%, which is the same as before. In addition, the People's Bank of China announced on June 1st that it had conducted a 7-day reverse repurchase operation of 11 billion yuan through fixed interest rate and quantity bidding, fully meeting the needs of primary traders, with an operating interest rate of 1.40%. The 7-day reverse repo operation is a short-term liquidity adjustment tool used by the People's Bank of China to purchase securities from primary traders and agree to sell them back within the next 7 natural days. It is one of the core products of the central bank's open market operations. At present, the 7-day reverse repo operation interest rate has gradually become the main policy interest rate, and its changes directly affect the transmission of interbank market interest rates (such as DR007) and loan market quoted interest rates (LPR). According to the reporter's understanding, on July 8, 2024, the People's Bank of China announced that from now on, temporary positive repurchase or temporary reverse repurchase operations will be carried out depending on the situation, from 16:00 to 16:20 on working days, with a term of overnight, using fixed interest rates and quantity bidding. The interest rates for temporary overnight positive and reverse repurchase operations are respectively the 7-day reverse repurchase operation interest rate minus 20 basis points and plus 50 basis points. If the operation is carried out on the same day, a "Public Market Business Trading Announcement" will be issued after the operation is completed. Afterwards, the central bank also made a series of monetary policy adjustments. Especially on July 22, 2024, the People's Bank of China announced that in order to optimize the open market operation mechanism, the 7-day reverse repurchase operation in the open market will be adjusted to a fixed interest rate and quantity bidding from today onwards. According to a research report by Tianfeng Securities, in June of previous years, the central level of the capital interest rate was generally at the mid to upper level of the year. In the first half of the year, the capital interest rate remained relatively stable, gradually showing an upward trend from the middle of the year, and by the end of the month, the upward trend had increased, reaching a high point. In May of this year, the objective consumption of liquidity increased, market expectations for continued easing loosened, and funding interest rates moderately rebounded, which reduced the "resilience" of the loose funding situation in June. Seasonal disturbances may increase the volatility of funds. But the loose foundation still exists, with the central bank's protective attitude unchanged in May and ample non bank liquidity possibly continuing until June. (Looking into the New Era)