BEIJING, Oct. 13 (Xinhua) -- China will raise the reserve requirement ratio by half a percentage point to 13 percent for commercial banks from October 25, the People's Bank of China (PBOC) announced on Saturday.
This is the eighth such move this year and only one month after the seventh hike of half a percentage point on September 25.
The move is aimed at "strengthening liquidity management in the banking system and checking excessive credit growth", the central bank said in a statement.
After the eighth rise, the reserve requirement ratio has reached a ten-year high.
The move came after the central bank's announcement on Friday that the country's foreign exchange reserve has exceeded 1.43 trillion U.S. dollars by the end of September, up 45.1 percent from the same period last year.
A total of 367.3 billion U.S. dollars were added to the country's foreign exchange reserve in the first nine months, 120 billion U.S. dollars more than the increment in the entire 2006.
The huge foreign exchange reserve is considered the main reason for excess liquidity in China, as the central bank has to spend money to purchase foreign exchange, aggravating the problem.
Excess liquidity could lead to price hikes and pour more fuel into the sizzling economy.
By the end of September, the M2 -- a broad measure of money supply, which indicates the monetary demand of the whole country, grew by 18.45 percent from a year ago to 39.31 trillion yuan.
China's commercial banks lent out 3.36 trillion yuan in the first nine months, surpassing the full-year figure in 2006.
The key economic data, including the GDP and the inflation indicator, which is to be released later this month, are estimated to remain high. The consumer price index reached a decade-high of 6.5 percent in August, and the GDP raised by 11.5 percent in the first half.
Besides a total of four percentage points hike of the reserve requirement ratio, the central bank has reduced the tax on interest income to 5 percent from 20 percent on August 15, and raised the interest rates for five times this year.
China to issue 100 bln yuan of special
treasury bonds
BEIJING, Oct. 13 (Xinhua) -- China's Ministry of Finance
will launch three tranches of special treasury bonds in the fourth quarter of
this year with a total value of 100 billion yuan.
The bonds are part of the 200 billion yuan worth of
special treasury bonds planned to be issued to raise 1.55 trillion yuan to fund
the country's new foreign exchange investment firm. Full story
China's forex reserve tops $1.43
trillion
BEIJING, Oct. 12 (Xinhua) -- China's foreign exchange
reserve had reached 1.43 trillion U.S. dollars by the end of September, up 45.1
percent year-on-year, the People's Bank of China announced on Friday. Full story
China's trade surplus hits $185.7 bln
in first 9 months
BEIJING, Oct. 12 (Xinhua) -- China's trade surplus hit
185.65 billion U.S. dollars in the first nine months, surpassing the full-year
figure in 2006, the General Administration of Customs said Friday.
Full story
China's tax revenue up 30.8% in first
9 months
BEIJING, Oct. 12 (Xinhua) -- China's tax revenue went up
30.8 percent to 3.72 trillion yuan (495.5 billion U.S. dollars) in the first
three quarters, the highest growth rate for the same period registered since
1994, the State Administration of Taxation (SAT) said on Friday. Full story
Chinese share prices close 0.17% lower
on Friday
BEIJING, Oct. 12 (Xinhua) -- Chinese share prices reversed
the rising trend in previous four trading days with the benchmark Shanghai
Composite Index closed at 5,903.26 points on Friday, down 9.97 points, or 0.17
percent.
The index experienced big intra-day fluctuations and at
one time hit 5,658.81 points at the lowest. Full story
