PBOC sells bills at highest yield in 2009

China’s central bank sold one-year bills at the highest rate this year, pushing up money market rates in a bid to avoid bubbles in the stock and property markets, Bloomberg reported. Climbing for the second straight time, the yield rose five basis points to 1.65% from last week. The People’s Bank of China sold US$2.2 of the debt in comparison to last week’s sale of US$2.93 billion. The report quoted Liu Jianyan, a fixed-income analyst at First Capital Securities as saying, “The central bank is using the gradual increase in yields to alert the market to prepare for a tighter policy in the future. But there won’t be a drastic reversal of previous loose monetary policy.”