China's money rates jump on month-end, holiday money demand

* 14-day repo rate jumps 68 bps to nearly 2-month high
* 7-day repo rate 28 bps to 2.91 pct
* Money demand centred on holiday and month-end

By Chen Yixin and Pete Sweeney
SHANGHAI, Jan 28 (Reuters) - China's seven-day and 14-day
money rates jumped on Monday thanks to an increase in cash
demand as banks prepare for the end of the month and the
beginning of the Chinese New Year holiday period in February,
dealers said.
The weighted-average rate of the 14-day bond repurchase rate
, set to mature in the midst of the Spring
Festival Holiday, jumped 68 basis points to 3.63 percent from
2.95 percent at the close on Friday, its highest level since
early January.
Traders said the jump is partly because the the People's
Bank of China (PBOC) is likely to abstain from issuing bonds
that mature while markets are closed for the holiday week,
dealers said.
The benchmark weighted-average seven-day bond repurchase
rate jumped 28 basis points to 2.98 percent from
2.70 percent, but the one-day repo rate inched
down to 2.10 percent.
Dealers said they expected to get through the upcoming
holiday season more smoothly than last year after regulators
said they will permit 12 primary dealers to bid for bond
repurchase agreements on a daily basis in order to increase the
monetary authority's flexibility in managing short-term
liquidity.

Current Prev close Change
(pct) (bps)
7-day repo 2.9801 2.6993 +28.08
7-day SHIBOR 2.9920 2.6980 +29.40
Note: Repo rate is weighted average.

($1 = 6.22 Chinese yuan)

(Editing by Simon Cameron-Moore)