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China's money rates fall, easy month-end period seen
January 25, 2013 / 6:17 AM / 5 years ago

China's money rates fall, easy month-end period seen

* Key 7-day money rate falls around 14 bps to 2.70 pct
    * 21-day tenor still attracts demand

    By Chen Yixin and Pete Sweeney
    SHANGHAI, Jan 25 (Reuters) - China's money rates fell
slightly on Friday, with the key seven-day money rate falling
around 14 basis points, on expectations that the market will
sail through the month-end period smoothly.
    The benchmark weighted-average seven-day bond repurchase
rate fell 14 basis points to 2.70 percent from
2.84 percent at the close on Thursday.
    The 14-day repo rate edged down to 2.94
percent from 2.95 percent, and the one-day repo rate
 rose slightly to 2.11 percent from 2.07 percent.
    Demand remained strong for the longer tenor in view of the
upcoming Chinese New Year holiday, although the 21-day repo rate
fell back slightly, dealers said.
    Cash demand typically rises during the holidays as firms pay
staff annual bonuses and shoppers withdraw money for
    The weighted-average 21-day bond repurchase rate
 fell to 3.80 percent from 3.81 percent after
jumping over 40 basis points on Thursday.
    "Some med- and small- sized institutions still have strong
demand for this tenor," said a dealer at a mid-sized commercial
bank in Shanghai.
    "Only the cross-holiday tenor is attracting demand, as
opposed to the other tenors which nobody needs right now," said
a dealer at a Chinese commercial bank in Shanghai.
                                 Current  Prev close  Change
                                       (pct)           (bps)  
7-day repo         2.6984     2.8355    -13.71
7-day SHIBOR           2.6980     2.8240    -12.60  
 Note: Repo rate is weighted average.
($1 = 6.22 Chinese yuan)

 (Editing by Sanjeev Miglani)

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