The governor of the People’s Bank of China (PBoC), Zhou Xiaochuan said Beijing does not need to rely only on interest rates as a monetary-policy tool, Bloomberg reported. “We will choose tools according to our economic situation,” Zhou said in an interview in Kuala Lumpur on the sidelines of a Malaysian central-bank event. “We don’t need to use just one tool." But he did not give any specifics as to what those tools were. The PBoC has yet to cut its key one-year lending rate this year after five reductions in 2008. The one-year lending rate is 5.31% while the equivalent rate for deposits stands at 2.25% Analysts said that the bank has probably not lowered rates because of bank lending has surged in January while drought is adding to the risk of inflation by cutting grain production.
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