Government in no hurry to up interest rates
(Xinhua)
Updated: 2006-06-05 10:10
The government will look to upcoming economic data before deciding on further
economic cooling measures such as an interest rate hike or an increase in bank
reserve ratios, the National Development and Reform Commission (NDRC) said.
"If data for May and June show that investment and credit continue to post
strong growth, the authorities could consider further adjustments to interest
rates and to increase the reserve ratio requirement for banks," NDRC said.
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An interest rates screen in a bank in Beijing.
The government will look to upcoming economic data before deciding on
further economic cooling measures such as an interest rate hike.
[newsphoto]
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"For now we should calmly observe the situation and closely monitor the
development in the economy. It is inappropriate to issue further tightening
policies in macro-control right now," the commission said in the report carried
by the China Securities Journal.
The central bank made a similar statement last month after it began
tightening credit in April.
Although the central bank raised its key one-year interest rate by 27 basis
points to 5.85 percent April 28, it is still struggling to mop up excess
liquidity contributing to excessive credit and investment, the report
said.
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