shanghai jan 13 reuters  chinas shortterm money rates jumped to fourmonth highs on thursday driven up by rising seasonal cash demand as the markets focus shifts to whether the central bank will trim policy rates to cushion the economic slowdown the volumeweighted average of overnight repurchase agreements or repos traded in the interbank market rose to 22291 the highest since sept 14 traders attributed higher borrowing costs to tighter cash conditions against the backdrop of reduced cash supply from big banks in the market as most lenders had to shore up their cash positions ahead of quarterly tax payments in january cash conditions started to tighten in late trade on wednesday with many scrambling for funds said a trader at a chinese bank traders expect the peoples bank of china pboc to step up liquidity injection through open market operations in the runup to the lunar new year holiday from jan 31 to feb 6 this year due to higher demand for cash from households and companies a staterun newspaper said earlier this month that the pboc was set to timely replenish liquidity shortfalls before the long holiday read more policy insiders and economists told reuters that chinas central bank was poised to unveil more easing steps to support slowing growth though it would likely favour injecting more cash into the economy rather than cutting interest rates too aggressively read more but some market analysts and traders still expect a marginal interest rate reduction this month following a cut to the lending benchmark loan prime rate lpr in december li chao chief economist at zheshang securities said a 5 basispoint cut to the pbocs sevenday reverse repo rate could happen as early as friday followed by reductions to interest rates on 14day reverse repos mediumterm lending facility mlf and lpr by the same margin next week the tiny rate cut is mainly due to the accelerated monetary tightening in other economies such as by the federal reserve and uncertainty in the domestic inflation trend li said in a note reporting by winni zhou and andrew galbraith editing by jacqueline wong