Tue, December 07, 2010
China's central bank may raise interest rates this weekend to enshrine its shift to a "prudent" monetary policy in the face of rising inflation, Reuters reported on Dec 7, citing the China Securities Journal.
The paper said that this weekend offered a "sensitive window" for a rate rise, which would be the country's second in its current tightening cycle.
The newspaper said the timing was right for such a move with official monthly economic indicators, notably the consumer price index (CPI), likely to show an increase in inflationary pressure when released on Monday, Dec 13.
"With reference to the central bank's record of raising interest rates just ahead of the release of CPI, this weekend will provide a window for a possible policy change," the newspaper said, without citing any source.
China's CPI in November may have risen to a 27-month high of 4.7 percent from a year ago, according to a Reuters poll, up from a 4.4 percent pace in October.
The newspaper added that the expected interest rate increase would form part of China's new monetary policy stance.
The country's top leadership said last week that Beijing was switching to a "prudent" monetary policy instead of its earlier "moderately loose" stance, paving the way for future monetary policy tightening.
(Agencies)
