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China stocks fall over interest rate hike

By Dong Zhixin (chinadaily.com.cn)
Updated: 2007-03-19 10:41

Chinese stocks plummeted upon opening Monday after the central bank announced an interest rate hike at the weekend.

The Shanghai Composite Index opened at 2,864.26, a decrease of 2.25 per cent from the closing point of the previous session.

The dive came after the People's Bank of China raised benchmark one-year lending and deposit rates by 0.27 percentage point on Saturday, the third increase in less than one year.

The rate rise was the latest in a series of tightening measures to cool off the torrid economy which, as Premier Wen Jiabao said Friday, is facing a list of problems, including excessive investment, credit, liquidity and swelling foreign exchange reserves.