Skip to main content
logo
  • Products
    Overview

    Funds

    • Performance & Yields
    • Liquidity
    • Ultra-Short
    • Short Duration
    • European domiciled products

    Solutions

    • Cash Segmentation
    • Separately Managed Accounts
    • Managed Reserves Strategy

    Fund Information

    • Regulatory Updates
  • Insights
    Overview

    Liquidity Insights

    • Liquidity Insights Overview
    • Case Studies
    • ESG Resources for Liquidity Investors
    • Leveraging the Power of Cash Segmentation
    • Cash Investment Policy Statement

    Market Insights

    • Market Insights Overview
    • Eye on the Market
    • Guide to the Markets
    • Market Updates

    Portfolio Insights

    • Portfolio Insights Overview
    • Currency
    • Fixed Income
    • Long-Term Capital Market Assumptions
    • Sustainable investing
    • Strategic Investment Advisory Group
  • Resources
    Overview
    • MORGAN MONEY
    • Global Liquidity Investment Academy
    • Account Management & Trading
    • Announcements
  • About us
    Overview
    • Diversity, Equity & Inclusion
    • Spectrum: Our Investment Platform
    • Our Leadership Team
  • Contact us
  • English
  • Role
  • Country
MORGAN MONEY LOGIN
Search
Menu
Search
You are about to leave the site Close
J.P. Morgan Asset Management’s website and/or mobile terms, privacy and security policies don't apply to the site or app you're about to visit. Please review its terms, privacy and security policies to see how they apply to you. J.P. Morgan Asset Management isn’t responsible for (and doesn't provide) any products, services or content at this third-party site or app, except for products and services that explicitly carry the J.P. Morgan Asset Management name.
CONTINUE Go Back
  1. China’s repo markets and new developments

  • LinkedIn Twitter Facebook

China’s repo markets and new developments

01-09-2015

Aidan Shevlin

Repurchase agreements (repos) are evolving, playing an ever more important role in China’s financial system. The repo market is a crucial funding source for financial institutions and an investment option for RMB money market funds, helping them offer cash investors relatively attractive returns with flexible liquidity. The People’s Bank of China also depends on the repo market as a critical quasi-monetary policy tool.

In Brief

  • Repos are a crucial component of global financial markets, increasing market efficiency and liquidity. In Western markets, long and widespread use of repo, combined with strong legal status under bankruptcy laws and the clarity provided by a master agreement of repo transactions, offers transparency and reassurance to investors and participants.

  • Chinese repo markets also follow standardised policies and procedures. However, the lack of clarity regarding collateral and counterparty risk, as well as confusion about how repo markets operate, has created uncertainty and concern.

  • There are two types of Chinese repo: interbank and stock exchange. RMB money market funds (MMF) favour stock exchange repo, which provides quasi-sovereign counterparty risk and more timely settlement, albeit with greater volatility. Because it offers uniform counterparty risk, real-time monitoring and genuine market-driven dynamics, stock exchange repo is widely recognised as the most accurate measure of funding costs, liquidity conditions and market stresses in Chinese financial markets.

  • Repo is an important investment option for RMB money market funds. Their ability to offer higher, market-driven interest returns helped spur the growth of MMF assets in China. Essential to this success has been the ability to invest in repo.
     

China’s repo markets 
China’s repo markets supplement

EXPLORE MORE INSIGHTS

China Money Market Resource Centre

Combining global expertise with local knowledge and resources to help you navigate this complex and rapidly evolving market.

Learn more

Liquidity Insights

View original research, reports and commentary from our portfolio managers, analysts, economists, and traders.

Learn more

Case Studies

Read about companies with specific cash management challenges and the solutions when they worked with J.P. Morgan Asset Management.

Learn more

0903c02a8235fc4d

  • China
J.P. Morgan Asset Management

  • Investment stewardship
  • About us
  • Contact us
  • Privacy policy
  • Cookie policy
  • Sitemap
J.P. Morgan

  • J.P. Morgan
  • JPMorgan Chase
  • Chase

READ IMPORTANT LEGAL INFORMATION. CLICK HERE >

The value of investments may go down as well as up and investors may not get back the full amount invested.

Copyright 2025 JPMorgan Chase & Co. All rights reserved.