On September 24th, the People's Bank of China (hereinafter referred to as the "Central Bank") released the "Mid term Lending Facility Tendering Announcement for September 2025", which showed that in order to maintain sufficient liquidity in the banking system, on September 25th, 2025 (Thursday), the People's Bank of China will carry out 600 billion yuan MLF operations through fixed quantity, interest rate bidding, and multi price bidding, with a term of one year. Given that 300 billion yuan of MLF will expire this month, this means that the net injection of MLF by the central bank in September reached 300 billion yuan, marking the seventh consecutive month of increased volume. At the same time, considering that the central bank also launched a net injection of 300 billion yuan of buyout reverse repurchase this month, this means that the total net injection of liquidity in mid September reached 600 billion yuan, the same as in August, and the net injection scale continues to be at a high level. Wang Qing, Chief Macro Analyst of Dongfang Jincheng, stated in an interview with reporters that after the reserve requirement ratio cut in May released nearly 1 trillion yuan of long-term liquidity, the medium-term liquidity has remained in a net release state for the past four months, and the net release scale has significantly expanded in the past two months. There are three main reasons for this: firstly, at present, it is in the peak period of continuous issuance of government bonds, and the regulatory authorities are also guiding financial institutions to increase their monetary and credit injection. The central bank continues to inject medium-term liquidity, reflecting the coordination and cooperation between monetary and fiscal policies, which helps to smoothly issue government bonds and better meet the credit financing needs of enterprises and residents. Secondly, due to factors such as the impact of anti internal competition on market expectations and the strengthening of the stock market, interest rates in the mid to long term market have generally risen recently, and liquidity in the banking system has tightened. The central bank has increased its capital injection through policy tools such as MLF, which helps stabilize market expectations and maintain sufficient market liquidity. The third is that the central bank continues to implement mid-term net liquidity injections, and is also releasing policy signals of continuous strengthening of quantitative monetary policy tools, demonstrating the continued supportive stance of monetary policy. Wang Qing believed that the quantitative monetary policy tools in the fourth quarter are expected to further exert their power, and the central bank is likely to implement a new round of RRR reduction and resume treasury bond trading in due course. While injecting long-term liquidity into the banking system through these two policy tools, it is expected that the central bank will continue to inject medium-term liquidity into the market through a combination of buyout reverse repurchase and MLF operations in the fourth quarter. This means that market liquidity will continue to be in a relatively stable and abundant state before the end of the year, and there is not much room for market interest rates to rise. (New Society)