GC Asia
Bankers hope for return of deals as PBoC settles liquidity fears
Asia’s financial markets began to recover from fears of a Chinese liquidity crunch on Wednesday after the People’s Bank of China (PBoC) released a statement on Tuesday saying that it would execute money market operations to stabilise markets and ease the pressure on banks. In response, DCM bankers dared to hope that prospects for dealflow would now improve.
China’s Shanghai Interbank Offered Rate (Shibor), which had shot up to a high of 13.44% on June 20 — although individual overnight repo trades were spotted that day as high as 25% — had fallen to 5.5% by the Wednesday fixing, down from Tuesday’s 5.83%.
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