China Money Market Rates Spike

China’s money market rates spiked on Wednesday to a four-month high, a day after the country’s central bank injected funds into the market to ease worries that it was planning to significantly tighten credit conditions.

The seven-day repo rate, viewed as a key gauge of confidence to lend in the interbank markets, rose to around 5.59 percent – up about 64 basis points from the previous day.

Analysts said that the jump in rates was seasonal in nature and at this stage were not too concerned about a repeat of events in June when a surge in money market rates fueled fears of a credit crunch in the world’s number two economy.


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