国内英语资讯: Economic Watch: China stands firm on monetary policy after Fed rate hike_时事

国内英语资讯: Economic Watch: China stands firm on monetary policy after Fed rate hike

What these higher rates do indicate, however, is improving economies both at home and abroad and rising consumer prices, while constituting a prudent response to the Fed.

The PBOC is intent on keeping the China-U.S. interest rate gap moderate to avoid heaping pressure on the yuan and running the risk of a capital flight, according to China Merchants Bank analyst Liu Dongliang.

Ren Zeping, chief economist at Founder Securities, sees no need for a benchmark rate hike as long as inflation remains mild and the nascent economic recovery fragile.

Instead of raising benchmark rates, Ren suggests the central bank opt for a structural interest rate hike while stabilizing the yuan.

The latest economic indicators have been as good as, or better than, expected: strong imports, producer inflation rising at its fastest in nearly nine years, industrial output on the up and fixed-asset investment growing steadily. Taken together, these factors suggest that the Chinese economy is moving in the right direction.

With the 2017 growth target set at around 6.5 percent, the lowest in a quarter of a century, and monetary policy rebranded as "prudent and neutral," China is aiming to increase M2 by around 12 percent this year, one percentage point lower last year's target.

New loans hit a record high last year, the third year in a row in excess of the 2009 level, when the country spent its way out of the global financial meltdown. While these loans provide the fuel for China's economic rebound, they come encumbered with the risk of asset bubbles. Left unchecked, these bubbles will threaten financial stability and darken the prospects for the broader economy.