For example, if the central bank is compared to one person, he is the steward of the whole market. If the market is illiquid, he will lend money to people in the market. The housekeeper said that she would lend you 654.38 billion yuan first and use bonds as collateral. After 7 days, you have to pay me back and give me interest. People who are short of money in the market see that the interest rate is suitable and rush to borrow money with bonds. Then this 654.38+00 billion entered the market circulation, which was equivalent to reverse repurchase, and 654.38+00 billion was put into the market and released. Then, the borrowed money must be returned, so there is another concept called reverse repurchase due, and the housekeeper returns the mortgaged bonds to the borrower and recovers the principal and interest by the way. At this time, 654.38+00 billion will be returned.
If the housekeeper thinks that there is still not enough money in the market after the expiration, she will take back the money she lent last time and continue to do it again. This time she lent you 65.438+05 billion. This is to continue drainage.
If it thinks that there is too much money in the market, funds are running around and raising house prices, it can't continue to release water. When the reverse repurchase expires, no new operations will be carried out. After 654.38+000 billion yuan came back, there was no new money to go in, that is, collecting water to withdraw funds. In the above analogy, people in the market refer to the first-class dealers in the open market. To put it bluntly, there are relatively large commercial banks. At present, she should be 40. The housekeeper is of course the bank of the bank, and she is respectfully called Yang Ma.
2. What does it mean that the central bank is buying back?
The central bank repurchase is to get the money back, which is divided into positive repurchase and reverse repurchase. These two opposite operations are the actions of the central bank in the open market.
To sum up, reverse repurchase is to release water and increase market liquidity. If you don't continue to reverse repurchase at maturity, it is to collect water. On the contrary, positive repurchase means pumping water from the market and reducing liquidity. Both of them are short-term market regulation behaviors, and the normal operation of the central bank serves the stability of the financial market.