China's money rates rise but market stable

Wed Jan 30, 2013 11:41pm EST

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* Benchmark rate up 2 bps to 3.24 pct
    * C.bank conducts first net injection of 2013

    By Chen Yixin and Pete Sweeney
    SHANGHAI, Jan 31 (Reuters) - China's money rates rose
slightly on Thursday on strong cash demand, but the People's
Bank of China (PBOC) kept the money market stable by conducting
a net cash injection through open-market operations.
    The PBOC injected a net 59 billion yuan ($9.48 billion) into
the banking system this week, the first net weekly injection of
2013. 
    The benchmark weighted-average seven-day bond repurchase
rate rose 2 basis points to 3.24 percent from 3.22
percent at the close on Wednesday.
    The 14-day repo rate rose to 3.57 percent
from 3.31 percent, and the one-day repo rate rose
to 2.32 percent from 2.11 percent.
    Dealers said money rates have little space to move sharply
as the central bank has clearly shown it intends to keep money
conditions stable through short-term liquidity operations.
    Dealers observed especially strong demand for funds with
tenors maturing after the Lunar New Year holiday and the next
two reserve requirement adjustment periods.
    The weighted-average 21-day repurchase rate 
hit 4.17 percent, the highest level of 2013. It was at 4.07
percent at the close on Wednesday.
    
                                 Current  Prev close  Change
                                       (pct)           (bps)  
7-day repo         3.2466     3.2243    + 2.23
7-day SHIBOR           3.2330     3.2360    - 0.30 
 Note: Repo rate is weighted average.
     
($1 = 6.21 Chinese yuan)

 (Editing by Simon Cameron-Moore)
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