Reading some tealeaves:
- The PBOC has not drained nor added funds via repos at today’s open market operations
- There were some expectations they may have eased funding difficulties, with many Chinese banks calling releif from the tight liquidity conditions, but no sign of easing
- There is a very small of 3-month bills due later this morning (amount is 2bn yuan), another sign that there is no easing to be forthcoming
The AUD has fallen a little on the repo news (as always correlation is not causation, but it seems a reasonable response)
