This undated photo shows Chinese 100 yuan banknotes. (PHOTO / VCG VIA CHINADAILY.COM.CN)

BEIJING – China's central bank on Sunday pumped cash into the banking system via reverse repos to maintain liquidity.

The People's Bank of China injected 100 billion yuan (about US$14.17 billion) into the market through seven-day reverse repos at an interest rate of 2.2 percent, according to a statement on the website of the central bank.

The move is intended to maintain stable liquidity in the banking system, the central bank said.

READ MORE: China's central bank injects liquidity into market

As 120 billion yuan of reverse repos matured Sunday, the operation led to a net withdrawal of 20 billion yuan from the market.

A reverse repo is a process in which the central bank purchases securities from commercial banks through bidding, with an agreement to sell them back in the future.

China will pursue a prudent monetary policy in a more flexible and appropriate way, according to this year's government work report.

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The country will use a variety of tools including required reserve ratio reductions, interest rate cuts, and re-lending to enable M2 money supply and aggregate financing to grow at notably higher rates than last year, said the report.