China raises interest rate by 25 bps for the third time this year
08 Jul 2011
China's third round of interst rate hikes came into effect today.
The People's Bank of China (PBOC) had yesterday announced raised bank's benchmark one-year borrowing and lending rates by 25 basis points, to curb rising inflation.
This hike is the third time China's central bank has raised interest rates this year, and follows the rate hikes of 5 April and 8 February.
In addition, China's central bank has raised the reserve requirement ratio for banks six times this year.
The move raises the benchmark one-year deposit rate to 3.50 per cent and the one-year benchmark lending rate to 6.56 per cent.
China's consumer price index (CPI) rose 5.5 per cent in May y-o-y, up from 5.3 per cent in April - the fastest in nearly three years.
The CPI index for May hit a 34-month high much above the government's target ceiling of 4 per cent for the year.
