S'pore interbank rate negative

S'pore interbank rate negative

SINGAPORE (AFP): Interbank rates have slipped into the negative in Singapore with banks charging other banks to park funds overnight, bankers said yesterday.

"There are a lot of excess funds in the market and not enough borrowers," said Andrew Chan, a senior money market dealer at Deutsche Bank AG.

The interbank rate for overnight deposits has been between negative 0.0625 percent and zero for the past two-and-a-half weeks to deter depositors, said Chan.

"Market sentiment is positive about the Singapore economy and a lot of funds are coming from Hong Kong," said another dealer.

She said speculation about the reportedly poor health of Chinese leader Deng Xiaoping had contributed to the flow of money out of Hong Kong.

Dealers said the sluggish stock market had also led investors to park their funds in banks while waiting for a rebound in share prices.