Zhou: Interest rate raises to be infrequent

It will not be necessary for the central bank to raise interest rates very often in the near future, though the possibility of small rises should not be ruled out, said People's Bank of China governor Zhou Xiaochuan, the Wall Street Journal reported. Zhou, speaking at a meeting of the Bank for International Settlements in Cape Town, would not give projections very far into the future, but said there would not be any interest rate rises this week. He said the central bank would continue to reduce liquidity in other ways, such as reserve requirement raises, which he said would continue at the current pace. Interest rates have been raised five times in 2007, while the reserve requirement ratio has been increased nine times. In September, the central bank raised the one-year deposit rate to 3.87% from 3.6%.