China Puts Priority on Interest Rate Reform

BEIJING – China’s cooling measures have curbed investment and credit growth, and the top priority will now be to reform interest rates, a central banker has said.

“The most important thing is to further push market-oriented reforms of interest rates, with the ultimate goal of making interest rates, the exchange rate and the price of capital truly reflect market supply and demand,” Li Ruogu, deputy governor of the People’s Bank of China, said. In remarks published on the Web site of the China Securities Journal (www.cs.com.cn) on Tuesday, Li said the government would monitor the economy closely and take any “necessary measures” to ensure stable and balanced growth.

Li’s comments came as the lastest round of data about China’s economy showed marked slowdowns in investment and credit growth, mixed with still-high consumer prices and accelerating industrial output.

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