Beijing-The People’s Bank of China (PBOC) is set to proceed with a planned medium-term lending facility (MLF) operation Thursday, continuing a series of recent liquidity injections into the banking system[[1]]. This month’s 400 billion yuan operation follows similar moves in recent months, including a 900 billion yuan injection in October and 600 billion yuan in September[[1]], as the central bank navigates a shifting economic landscape. The PBOC’s use of fixed-quantity, fixed-rate bidding for these operations reflects a recent policy shift[[3]], with further MLF operations scheduled for August 2025[[2]].
Beijing, December 25, 2025 – The People’s Bank of China (PBOC), the country’s central bank, announced Wednesday it will conduct a medium-term lending facility (MLF) operation today, Thursday, December 26, 2025, totaling 400 billion yuan (approximately $56.76 billion USD) with a one-year tenor. This move is designed to maintain ample liquidity within the nation’s banking system.
The PBOC stated the operation will utilize a fixed quantity, fixed rate, and multiple-price bidding method.
China first introduced medium-term lending facilities in 2014 as a mechanism to support commercial and policy banks in managing their liquidity. The facilities allow these banks to borrow funds from the central bank using securities as collateral.
The PBOC’s action signals its continued commitment to supporting financial stability amid evolving economic conditions. MLF operations are a key tool used by the central bank to influence interest rates and credit availability in the broader economy.
The central bank’s decision to inject liquidity comes as markets closely watch for signals regarding future monetary policy adjustments.
