* 7-day repo rate fell 5 bps to 3.12 pct, around 2-week low
* C.bank conducts 32 billion yuan net drain on Thursday
* Dealer expects money rates may rise by mid January
By Chen Yixin and Pete Sweeney
SHANGHAI, Jan 8 China's money rates were little
changed on Tuesday after the People's Bank of China allowed a
net drain during open market operations, as dealers said there
was enough cash in the market to absorb the reduction.
China's central bank only injected 38 billion yuan ($6.10
billion) into the money markets through reverse bond repurchase
agreements on Tuesday morning, compared with 70 billion worth of
previously issued reverse repos maturing the same day, resulting
in a net drain of 32 billion yuan on Tuesday.
"The central bank drained funds today, but I do not see any
tightening for now," said a dealer at a Chinese commercial bank
in Shanghai. "I think rates could fall further this afternoon."
But he said money rates could rise by the middle of January
as firms prepare to dip into bank deposits to pay an estimated
one trillion yuan in taxes due for the end of the fourth
The benchmark weighted-average seven-day bond repurchase
rate fell 5 basis points to 3.12 percent from 3.17
percent at the close on Monday but remains near a two-week low.
The 14-day repo rate fell to 3.17 percent
from 3.24 percent, and the one-day repo rate edged
up to 2.15 percent from 2.12 percent.
Current Prev close Change
7-day repo 3.1249 3.1695 - 4.46
7-day SHIBOR 3.1500 3.2000 - 5.00
Note: Repo rate is weighted average.
($1 = 6.23 Chinese yuan)
(Editing by Simon Cameron-Moore)