Saturday, March 17, 2007

rates increase

The People's Bank of China announced Saturday afternoon that, effective Sunday, it was raising by 0.27 percent the regulated interest rates that banks may charge for loans and may pay for deposits. The benchmark rate for one-year loans to companies with reasonably good credit will become 6.39 percent, while the one-year deposit rate will become 2.79 percent.

Higher interest rates could widen China's trade surplus, economists said, as its exports keep rising but its demand for imports may slacken somewhat. Higher interest rates tend to brake investment spending on costly industrial equipment.



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