Earlier, the People’s Bank of China (PBOC) left a key policy rate unchanged while withdrawing cash from a medium-term policy loan operation for the first time in 16 months.

Some analysts and traders interpreted the withdrawal as an official signal to markets that the central bank was reducing liquidity in line with a government call to prevent idle funds.

“The central bank has no intention of actively draining cash,” the official newspaper said, citing experts.

“The current market funding conditions have been generally loose, and nearly 400 billion yuan (US$55.58 billion) worth of medium-term lending facility (MLF) has injected enough liquidity into the banking system. Monetary policy remained supportive of the real economy.”

China has set an ambitious 2024 economic growth target of around 5%, promising steps to transform the country’s development model and defuse risks fuelled by bankrupt property developers and indebted cities.