China Will Probably Increase Interest Rate
SHANGHAI, KOMPAS.com - An adviser to China's central bank says Beijing may raise interest rates in the second quarter if inflation exceeds three percent, according to state media reported on Wednesday (7/4/2010).
The world's third largest economy may have grown more than 11 percent in the first three months of this year, while full-year growth could reach 9.5 percent, the China Securities Journal said citing Li Daokui.
Li recently appointed Central Bank monetary policy committee of China (People's Bank of China's), which advises the central bank on interest rates and exchange rate policy.
China is expected to first quarter data released officially on 15 April. Asian countries return to double digit growth in the fourth quarter, expanding 10.7 percent in large-scale public spending and bank lending is rampant.
The government has been watching closely amid fears of loans that could trigger inflation and asset bubbles that damage caused.
Analysts expect a rate hike earlier this month after consumer prices rose 2.7 percent in February, up from 1.5 percent in January and close to the government's target of three percent for 2010.