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.”
