PBOC gives banks $28b fresh funds via MLF

China's central bank offered banks 200 billion yuan ($28 billion) in fresh liquidity via its medium-term lending facility (MLF) on Monday, leaving enough room for a further easing of the monetary policy in the ensuing months to spur economic recovery, analysts said.

The People's Bank of China said the fund infusion was to maintain liquidity at an ample level in the banking system. The MLF is a monetary policy tool established by the PBOC in 2014 to offer collateralized loans to banks.

The interest rate of the one-year MLF was set at 2.95 percent, unchanged from its level in May. " (The liquidity offer) can fully meet the needs of financial institutions," said a statement on the PBOC website. The central bank said last week it would conduct such MLF operations to roll over the maturing liquidity this month.