HONG KONG - A bid by ­China's central bank to curb soaring interest rates and relieve pressure on the financial system appeared to have come up short Monday, as Chinese money market rates shrugged off the measure and continued to approach the highs seen in June.

The central bank, the People's Bank of China, said late Friday that it had provided more than 300 billion renminbi (about $50 billion) in short-term funds to selected banks over a three-day period that week.

Rates continued to surge Monday, however, in China's money markets — a key source of short-term funding for commercial banks and also for financial institutions engaged in risky, off-balance-sheet shadow lending.

One key rate, the seven-day repurchase rate, rose as high as 10 percent Monday. That was double the rate of a week earlier and the highest level since June, when the People's Bank of China allowed rates to surge in an effort to curb speculative investment in the country's sprawling shadow banking sector.

China's banks are scrambling for short-term cash to meet month-, quarter- and year-end regulatory requirements. Demand for cash also is high among Chinese companies seeking to meet year-end payments.

These and other factors have combined to push the costs of short-term borrowing in China up drastically, a situation that if left unchecked, could leave some banks struggling to meet their obligations and could have implications for the broader economy.

Part of the reason for China's liquidity shortage is that the central bank has been ­purposely refraining from its regular open-market operations — the buying and selling of money-market instruments to manage liquidity and ­interest rates.

Analysts see this as a signal that the People's Bank of China is serious about reining in the shadow banking sector.

new york times