(Yicai Global) Nov. 23 -- Chinese yuan funding of up to three months will be sluiced to primary dealers through the Monetary Authority of Singapore’s money market operations under a new CNY25 billion (USD3.8 billion) initiative it announced today.

The MAS will discontinue the current CNY5 billion MAS Overnight RMB Liquidity Facility from today in consequence, per the announcement on the central bank’s website.
To support the development of the offshore Chinese yuan market in Singapore, the authority previously set up its Overnight RMB Liquidity Facility and MAS RMB Facility.

Banks were able to access these backstops to obtain overnight and term yuan funds as needed to ease settlement needs and fund cross-border trade and investment.
“Market participants have indicated that the placement of longer tenors and larger amounts of yuan funding by the initiative are significant enhancements over the MAS Overnight RMB Liquidity Facility,” the MAS said.

The bank will continue to provide additional term financing as needed, it added.

Editor: Ben Armour, Xiao Yi