Saturday, December 25, 2010

The People's Bank of China Gives the People a Christmas Day Rate Hike

The PBOC raised benchmark one-year lending rate 25 bases points to 5.81%, and raised the one year deposit rate 25 basis points to 2.75%.

This is the second series of rate hikes in the last 30 days.

The PBOC appears to be moving much too slowly in its rate hikes to stop, or even significantly slow, price inflation, but the economy is likely to stall. It is likely stagflation reports will be coming out of China by mid-2011

1 comment:

  1. The benchmark one-year lending rate will rise by 25 basis points to 5.81 percent and the one-year deposit rate will climb by the same amount to 2.75 percent, effective today, the People’s Bank of China said in a one-sentence statement on its website late yesterday.