China's money rates rose Monday, with the key seven-day money rate jumping to a more than three-week high due to demand for funds as companies meet tax payments, dealers said. 

The weighted average of the benchmark seven-day repo jumped 64 basis points (bps) to 4.34 percent by early afternoon, from 3.70 percent Friday.

The 14-day rate surged 68 bps from Friday's 3.64 percent, and the overnight rate rose to 2.98 percent from 2.88 percent. Market players expect the shortest one-day money rate to likely catch up with the sharper gains of the 7-day rate in the coming days.

Dealers said money rates had little potential to fall sharply before companies finish paying tax; but the key seven-day rate would not jump as it had already surged nearly 160 bps in three trading days.

Chinese firms must pay estimated corporate income tax each month, but must also balance their quarterly and annual taxes during a subsequent grace period. Annual tax payments for the previous year are typically balanced in April and May.

Dealers expect money conditions may remain ample after tax payments and the month-end as there are signs that funds continue to flows into the Chinese market.

Last week, data showed the People's Bank of China and commercial banks bought 294 billion yuan ($47.86 billion) worth of foreign exchange on a net basis in April, marking the fifth straight month of net purchases. One side-effect of these purchases has been an increased supply of yuan in the interbank market.