BEIJING - China's central bank drained 50 billion yuan ($7.14 billion) from the financial system on Wednesday.

The People's Bank of China skipped reverse repos on Wednesday, citing a relatively high level of liquidity at the end of the year thanks to increasing fiscal spending.

Meanwhile, 50 billion yuan of reverse repos matured Wednesday, resulting in a net liquidity withdrawal of 50 billion yuan.

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.

The country will continue to implement a proactive fiscal policy and prudent monetary policy, according to the annual Central Economic Work Conference.

The quality and effect of the fiscal policy must be enhanced with more efforts on structural adjustment, while the monetary policy should be pursued with moderate flexibility to maintain market liquidity at a reasonably ample level, said the statement released after the conference.