China Cuts...

China Cuts Interests Rates To Boost Economy

China's central bank has cut interest rates  for the fifth times since November,in a move to cushion steep losses in the share-market that have deepened fears of a worsening economic slowdown.

Beijing is targeting growth of 7 per cent this year,which would be the slowest pace since 1990. Photo: Reuters

Weaker-than-forecast economic readings and renewed stock market weakness the one-year lending rate will drop by 25 basis points to 4.6 per cent, effective Wednesday, the bank said in a statement on Tuesday evening.

The one-year deposit rate will fall by 25 basis points to 1.75 per cent.

The acceleration of monetary easing underscores the determination of policymakers to meet Premier Li Keqiang’s 2015 growth goal of about 7 percent cent.

The risk of capital outflows and tighter liquidity after China devalued its currency on August 11,added pressure for further stimulus.

“The economy is still under immense downward pressure, “Yao Wei,a paris-based China economist at Societe Generale SA, wrote before the move.

“Fiscal policy has to step up, and monetary policy is likely to play an assisting role by providing targeted liquidity.”