19 Jul 2013
PBOC announces liberalization of lending rates
FXstreet.com (Barcelona) - The People's Bank of China announced today that it would cease controlling interest rates and that it would allow financial institutions to set them on their own. It explained that this move was aimed at helping national businesses cut financing costs and streamlining the allocation of funds.
"This will support the real economy and improve economic restructuring and upgrading," the central bank said in the official statement.
The Australian dollar jumped on the news. Adam Button from Forex Live comments. "After some time to digest, the moves probably won't have a direct impact on the economy and might not even signal more cuts to come. The more important move will be to liberalize deposit rates but it's not clear this makes it any more likely. Some analysts say this could even make it less likely in the near term as officials wait to weigh the impact of this move."
"This will support the real economy and improve economic restructuring and upgrading," the central bank said in the official statement.
The Australian dollar jumped on the news. Adam Button from Forex Live comments. "After some time to digest, the moves probably won't have a direct impact on the economy and might not even signal more cuts to come. The more important move will be to liberalize deposit rates but it's not clear this makes it any more likely. Some analysts say this could even make it less likely in the near term as officials wait to weigh the impact of this move."