German money market interest rates firmed yesterday amid speculation the Bundesbank may signal higher interest rates at next week's auction for securities repurchase agreements, or repos.

The interest rate on overnight money in the interbank market rose as high as 3.15 per cent, up from 3 to 3.1 per cent on Wednesday.

Dealers said the rise was caused by a fall in market liquidity as banks held on to funds in the belief the central bank may make it more expensive to obtain money next week.