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China money rates steady despite reports of central bank fund rollover, IPOs
[SHANGHAI] China's money rates held steady on Wednesday, unmoved by media reports the central bank rolled over some short-term funds it had injected into the markets several months ago, traders said.
Cash demand for a slew of stock initial public offerings (IPOs) had also not affected the money market, they said.
Official media, including China Securities Journal and Shanghai Securities News, said on Wednesday that the People's Bank of China (PBOC) had renewed some funds it previously injected into the market via a policy tool known as the medium-term lending facilities (MLF), that were set to expire.
Speculation on the rollover had swirled in the market since late Tuesday, but Reuters was unable to independently confirm those rumours. The central bank does not respond to inquiries related to the opaque tool.
The weighted average of the benchmark seven-day repo rate was unchanged at 3.81 per cent in early afternoon trading on Wednesday.
Another active contract, the 14-day rate, dropped 6 basis points to 4.73 per cent, while the one-day rate fell 2 basis points to 2.6 per cent.
Twenty-two Chinese companies are launching IPO subscriptions to investors this week in the Shanghai and Shenzhen stock exchanges, with 10 of them on Wednesday alone.
Securities analysts estimate these IPOs will temporarily freeze around 2 trillion yuan (US$323 billion) for a few days, but investors mainly raise funds in the stock exchanges.