China’s overnight money rate jumps to a four-month high

Chinas overnight money rate jumps to a four month high

SHANGHAI : China’s short-term money rates jumped to four-month highs on Thursday, driven up by tight cash conditions in money markets because of seasonal increase in cash demand.

The volume-weighted average of overnight repurchase agreements, or repos, traded in interbank market rose to 2.2238per cent, the highest since Sept. 16.

Some traders said cash demand rose ahead of quarterly tax payments in January, while households and corporates also need more cash for various needs and payments ahead of the long Lunar New Year holiday, which falls from Jan. 31 to Feb. 6 this year.

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