*PBOC injects most short-term funds this month amid cash crunch* China’s central bank increased injection of short-term funds into the financial system on Friday, in an attempt to ease a cash crunch that has roiled the nation’s bond market. The People’s Bank of China added a net 84 billion yuan ($11.6 billion) of cash in daily open market operations, according to calculations. That’s the largest single-day infusion in February, when the central bank has been draining liquidity in most sessions. The PBOC has been tolerating a surge in repo rates and kept liquidity conditions tight, aiming to support the yuan amid economic headwinds. That, however, has pressured the bond market with the 10-year benchmark yield reaching the highest since December. Investors shifting money into stocks to ride a tech-driven rally was also behind the debt selloff. China’s one-year government bond yield slipped one basis point on Friday to 1.47% following the operation, set for its first decline in two weeks. Yields have been rising as the PBOC held back on further monetary easing to prioritize yuan stability in the wake of a renewed trade war with the US. Traders are keen to know how long the central bank would stick to that stance, with the Chinese economy in need of looser monetary policy. The PBOC hinted at a flexible approach in a quarterly monetary policy report earlier this month, saying it will “choose the opportunity to adjust and optimize the intensity and pace of policies based on domestic and foreign economic and financial conditions.”