China's central bank continued to pump cash into the financial market in May to meet the demand for liquidity from financial institutions.

A total of 200 billion yuan (about 28.9 billion US dollars) was injected into the market via the medium-term lending facility (MLF) last month to maintain liquidity in the banking system at a reasonably sufficient level, according to the People's Bank of China (PBOC), the central bank.

The funds will mature in one year at an interest rate of 3.3 percent.

Total outstanding MLF loans reached 3.6 trillion yuan as of the end of May.

The MLF tool was introduced in 2014 to help commercial and policy banks maintain liquidity by allowing them to borrow from the central bank using securities as collateral.

In May, the PBOC did not inject funds through pledged supplementary lending (PSL) to the China Development Bank, the Export-Import Bank of China and the Agricultural Development Bank of China.

Total outstanding PSL loans in the first five months amounted to 3.53 trillion yuan.

Another 25.62 billion yuan was lent to financial institutions through the standing lending facility to meet provisional liquidity demand.

China's monetary policy should be "neither too loose nor too tight," while liquidity will be kept at a reasonable and ample level, according to a statement issued after a quarterly meeting of the PBOC monetary policy committee in April.