The People's Bank of China, the country's central bank, has launched the first operation of a new swap facility aimed at boosting stock market liquidity, with the first stock buying transaction financed through the facility on Tuesday.

Swap facility lets brokers, asset managers and insurance companies exchange assets with poorer liquidity, enabling them to get liquid assets for stock purchases.

China central bank said it conducted its first swap operation involving securities, fund, and insurance companies for the amount of 50 billion yuan ($7.03 billion) on Monday.