China's central bank lowered the funding cost of 14-day reverse repos when injecting 150 billion yuan ($23.68 billion) via the liquidity tool into the banking system on Monday.
The 14-day reverse repo rate was lowered by 10 basis points to 2.25% from 2.35% previously.
The People's Bank of China (PBOC), in an online statement, said the liquidity offerings were to "maintain stable liquidity ahead of the Lunar New Year."
The week-long holiday starts on Jan. 31.
The reduction to the interest rate of 14-day reverse repos was not a surprise, traders said, after the PBOC lowered a slew of key short- and medium-term rates last week.