The central bank injected nearly 2 trillion yuan of short-term liquidity, or increase efforts before the end of the year

　　The People's Bank of China (PBoC) has continued to pump record amounts of short-term cash into its financial system in recent days, though some analysts say more may be needed.

　　Money market signals suggest traders expect borrowing costs to rise for the rest of the year, despite the massive cash injections. A gauge of one-year bank funding costs in the market has stabilized above the level of the People's Bank of China's benchmark interest rate for the first time since 2019, indicating a scarcity of liquidity in the system.

　　The central bank added a record Rmb1.96tn in short-term cash over the past three days, while outstanding one-year policy loans are on track to hit a record Rmb5.7tn after a mid-October operation, according to Bloomberg calculations.

　　Becky Liu, head of China macro strategy at Standard Chartered, said: "We expect more support from the People's Bank of China. This will be achieved through a variety of tools, including a possible cut in bank reserve requirements and continued cash injections through the Medium-Term Lending Facility (MLF). At the same time, we may also expand the provision of structured loans."

　　Li Yishun, an analyst at Cinda Securities, said: "Banks are under pressure to keep their funds stable and their liquidity situation may not improve in the rest of the year. A surge in bond supply and shrinking deposits after previous rate cuts could make banks more dependent on PBOC support in the future."