SHANGHAI, July 29: The volume-weighted average price (VWAP) for China’s benchmark seven-day bond repurchase agreement was at 4.8333 percent by mid-morning on Monday, up from the previous close of 4.4144 percent.
The VWAP rate was calculated based on the first three transactions recorded for that contract.
The first two quotations came in at 5 percent, but the VWAP was pulled back down by an ensuing transaction posted at 4.5 percent.
Ensuing quotes, however, have all posted at 5 percent, and are dragging the VWAP back upward at the time of reporting.
Market players are keeping a close eye on Chinese interbank market rates after tightness in the money markets in June caused a cash crunch for banks and led to a slide in mainland stock indexes.
The People’s Bank of China is set to allow 85 billion yuan ($13.86 billion) to enter the interbank market this week through maturing bills. It has injected a net 33 billion yuan this year.
($1 = 6.1316 Chinese yuan)
(agencies)
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