China central bank sees deposit rate liberalisation in 2 years Chinas central bank governor said on Tuesday that the countrys deposit rates are likely to liberalised in one to two years - the most explicit timeframe to date. In a media briefing lasting more than an hour at Chinas annual parliament session, Zhou Xiaochuan offered few surprises, reiterating a promise to speed-up financial reform and to move steadily towards freeing up the yuan on the countrys capital account. Deposit rate liberalisation is on our agenda. Personally I think its very likely to be realised within one or two years, the head of the Peoples Bank of China said. However, he said he expected deposit rates to rise as a result. The central bank already allows banks to set their own lending rates. Beijing announced sweeping reforms late last year as it tries to shift the economy away from a reliance on the investment and exports that have fuelled double-digit expansion for three decades in favour of consumption and services, which it hopes will generate more sustainable long-term growth. However, data at the weekend raised fresh concerns about the outlook for the worlds second-biggest economy. Exports in February tumbled more than 18 percent from a year earlier and purchasing managers reports have suggested factory sector growth is stalling. Every bout of weaker-than-expected data raises market speculation that in pushing through with reforms, Beijing is at the same time sending the economy into a slump. The government expects the economy to grow 7.5 percent this year, which would be the lowest pace in 24 years, although Finance Minister Lou Jiwei said that this target was flexible. The economy grew 7.7 percent last year.
Posted on: Tue, 11 Mar 2014 03:08:54 +0000