A shocking news came from China, for the first time on Tuesday, China's central bank raised its benchmark interest rate.
Of course this is a shocking news, because China's central bank never changes that interest rate interest for the last three years, since 2007.
Of course this is a shocking news, because China's central bank never changes that interest rate interest for the last three years, since 2007.
The china policy was the impact through the world. Oil prices were dropped, American index market and European have down a few points. This interest rate hikes beyond market expectations.
Analysts suspect that China's central bank raised interest rates due to soaring inflation in China has made a real interest (real interest rate) in China to be negative, or this is done due to pressure from the United States, which accused the Chinese policy of holding the value of its yuan currency, resulting in large trade deficits for the United States.
On the meanwhile, many analysts who say that the President of the United States, Barack Obama, to pressure against the Chinese government and accused the Chinese hold the yuan rate, neglected by the government of China.
China raised interest rates by 0.25% so the interest rate term deposits of one year to 2.5%, meanwhile, lending rates to 5.56% per year. However, the interest rate hikes have yet to be approved by the supreme leadership of the Chinese government
Many economists were predictable the central bank's move to raise interest rates early this be a signal that China would tighten monetary policy more aggressively. Because of all, they were only relying on credit restriction policy and increased statutory reserves of banking.
The purpose of this policy is to reduce the adverse impact of economic growth. One is a bubble (buble prices) of many assets. Fundamentally, within about 10 percent of economic growth, China's benchmark interest rate is too low.
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