The People’s Bank of China (PBoC) has raised an interbank market interest rate, indicating a policy shift away from focusing solely on stimulating economic growth and reflecting increasing concerns about mitigating inflation risks, the Wall Street Journal reported. While the PBoC’s decision to offer a higher yield in its weekly bill sale was the first such move in nearly five months, it maintains the bank’s preference for liquidity management over policy interest rates as a means of controlling inflation. The bank sold US$8.8 billion in three-month bills at 1.3684%, the first change in yield since August 13. In addition, the bank drained US$20 billion in money market funds this week, the most in approximately three months.
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