The People’s Bank of China (PBOC) raised its monetary market rate for the second time this year, and injected fresh funds into the country’s banking system, following the quarter-point rate increase by the U.S. Federal Reserve. The PBOC raised the reverse repo rate by 10 basis points, and injected CNY303 billion of funds into 17 of China’s financial institutions via the medium-term lending facility (MLF), setting the six-month MLF rate at 3.05% and the one-year MLF at 3.2%. The MLF tool was first introduced in 2014 to help commercial and policy banks maintain liquidity by allowing them to borrow from the central bank. The reverse repo, or repurchase, is a process whereby the central bank purchases securities from banks through bidding with an agreement to sell them back in the future. The U.S. FED for the second time in three months increased its benchmark interest rate by 25 basis points amid rising confidence in economic growth. Following the FED’s move, Hong Kong’s Monetary Authority raised the interest rate by the same margin to maintain the stability in the Hong Kong dollar’s peg to the U.S. currency.