The People’s Bank of China (PBoC) announced early Tuesday that it stands ready to support sovereign fund operations, reinforcing efforts to stabilize the country’s capital markets amid ongoing economic challenges. According to a Bloomberg report, the central bank said it will provide funding assistance to Central Huijin Investment Ltd. through a re-lending program “when necessary.”
The move signals Beijing’s determination to shore up investor confidence and bolster equity markets, with the PBoC affirming its full backing of Huijin’s decision to ramp up stock purchases.
In a show of coordinated support, China Chengtong Holdings Group and China Reform Holdings Corp. (Guoxin) also revealed plans to increase their investments in stocks and exchange-traded funds (ETFs), following Huijin’s lead earlier in the day.
Market Reaction
The announcement has bolstered risk sentiment in the region, with the AUD/USD pair ticking higher in response. At the time of writing, the pair is trading up 0.14% on the day at 0.5995, reflecting modest optimism amid renewed Chinese stimulus signals.
The PBoC’s targeted support measures come at a time when Chinese authorities are seeking to revive market momentum and counteract lingering economic headwinds, including sluggish consumer demand and persistent property sector instability.
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