Central bank bills, that is, central bank bills, are short-term debt certificates issued by the central bank to commercial banks to regulate their excess reserves, and their essence is central bank bonds.

Central bank bills are mainly used to undertake the function of short-term national debt, and play an important role in regulating the money supply, regulating the liquidity level of commercial banks, smoothing the fluctuation of money market and guiding the interest rate trend.

Central bank bills bear the function of regulating money supply. Influenced by the expectation of RMB appreciation and other factors, foreign exchange reserves have increased rapidly, which has greatly increased China's foreign exchange holdings.

In order to reduce the negative impact of the increase in foreign exchange holdings on the growth of the base money supply, the central bank issued a large number of central bank bills to play its sterilization function. Secondly, central bank bills can adjust the liquidity level of commercial banks.

At present, in the open market operation, the subscription subject of central bank bills is commercial banks, and the directional central bank bills are mainly issued to banks with abundant funds, especially those with excessive loan growth.