Managing inflation expectations

For the use of interest rate, central bank governor zhou xiaochuan, said in March this year to fight inflation "interest rate policy will be a need to use the important tool". But in April, zhou xiaochuan emphasizes the interest rate policy, "with too fierce words may incur hot money, capital inflows is bigger." herve leger v neck elegant bandage gold dress

And the central bank's latest statement is, according to situation development requirements, continuing with the interest rate adjust price control measures, such as capital demand and investment saving behavior, managing inflation expectations.

As for the deposit reserve rate, central Banks again this is targeted at the exchange inflows as contributing to the partial much liquidity, its use dynamics and adjust the space depends on multiple variable condition, therefore does not exist absolute limit.

"Five months so a huge amount of liquidity, only by the central issue is not realistic ticket hedge, again raise deposit reserve rate has put on the agenda." A state-owned commercial Banks if traders say again this month to raise deposit reserve rate 0.5 percentage point, it just would be deducted from last month's foreign exchange gap. herve leger v neck bandage rosy dress

According to several agencies forecast, April CPI index year-on-year growth rate is still in 5% above, some even predict to 5.5%. Although food prices fell slightly, but compared rise higher than non-food prices annulus, suggesting that PPI early to CPI conduction role is obvious, coming time upward pressure of inflation is bigger. The above traders say, from this point, interest rates to fight inflation most effective this tool may also have come down again at any time.