BEIJING - China's central bank skipped open market operations for the second consecutive day on Wednesday, citing relatively high liquidity in the banking system.

"The overall liquidity level in the banking system is relatively high as fiscal spending increases near the end of the month," the People's Bank of China (PBOC) said in a statement.

Fiscal expenditure allows fiscal deposits to flow into commercial banks from the central bank, improving market liquidity.

No reverse repos matured on Wednesday.

In Wednesday's interbank market, the overnight Shanghai Interbank Offered Rate, which measures the cost at which Chinese banks lend to one another, rose 14.7 basis points to 2.708 percent, with the rate for one-week loans edging up 4.5 basis points to 2.906 percent.

The central bank has increasingly relied on open market operations for liquidity management, rather than cuts in interest rates or reserve requirement ratios.

China plans to maintain a prudent and neutral monetary policy in 2018 as it strives to balance growth and risk prevention.