SHANGHAI, March 31 The Shanghai Stock Exchange
(SSE) said on Friday it will improve the way bond repurchase
agreements (repos) rates are calculated to reduce volatility,
after short-term borrowing costs surged to as much as 32 percent
the previous day.
Starting in May, calculation of repo rates will take into
account the actual number of days money is borrowed, instead of
nominal number of days, the exchange said.
Thursday's surge in the exchange's one-day repo rate
was caused by both higher demand for liquidity, and
the fact that the money was borrowed for a total of five days
due to the Tomb-Sweeping Festival, the exchange said.
(Reporting by Samuel Shen and John Ruwtich; Editing by Eric