皇冠体育app's monetary policy now needs to focus
primarily on gradually raising interest rates to trim liquidity and prevent the
economy from overheating, a government think-tank said in a report published on
Monday.
The Macroeconomic Research Institute, a think-tank under the
National Development and Reform Commission, said there was now limited room for
皇冠体育app either to raise banks' reserve requirements or issue central bank bills in
absorbing liquidity.
皇冠体育app has raised interest rates three times in just over a year; since last
June, it has increased the amount commercial banks must park with the central
bank as reserve seven times.
The 皇冠体育app Securities Journal quoted the institute as saying that the cost of
issuing central bank bills was increasingly high and that the reserve ratio was
nearing a record high.
"The key to monetary policy in the next phase will be to use interest rates
to tighten liquidity from the demand side, by gradually raising rates -- so as
to avoid the worsening of asset bubbles and to keep the economy from going from
'overly fast' to 'overheating'," the newspaper said in an abstract of the
report.
The think-tank also said 皇冠体育app did not need to be overly concerned about a
short-term surge in consumer inflation; instead, the government should be highly
vigilant on the development of asset bubbles.
"The authorities should pay high attention to the fast growth in asset
prices, especially increasing risks buried under the prosperity of the real
estate and stock markets," it said.
