Saturday, 11 December 2010

Speculation on China interest rate hike

China can’t raise interest rates because of the risk of attracting inflows of cash that would fuel inflation, said Wu Xiaoling, a former deputy governor of the central bank.

“The global low interest-rate environment prevents China’s central bank from raising interest rates,” Wu said in a speech at a hedge fund conference in Shanghai today. Emerging markets face capital inflows and “excessive money supply is one of the important reasons for China’s inflation,” she added.

China Inflation `Fight' May Widen as Growth Withstands Tightening Measures

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