国内英语新闻:China central bank raises deposit rate by 0.25 percentage points

China's CPI hit a 22-month high of 3.5 percent in August. The inflation index not only exceeds 2.25 percent on a one-year deposit rate, 2.79 percent on a two-year deposit rate, but also surpasses 3.33 percent of a three-year deposit rate.

Experts believe the interests rate hike works more as an alert, rather than directly reducing negative interests rate.

"The move shows the government's determination to curb negative interests rates and inflation so that businesses and consumers can adjust their investment and consumption accordingly," Liu said.

Just a week ago, the central bank declared it would temporarily raise the reserve requirement ratio of six big lenders to check inflation.

China has raised the bank reserve ratio four times this year and together with the rate hikes, these indicate China is resuming normal monetary policies after the global financial crisis, said Zhang Qizuo, deputy head of China International Economy Society.

China thus becomes a new member to hike interest rates following Australia, Norway, India and Brazil in the global economic downturn, while many economies lowered interests rates, like Russia, South Africa and Hungary.

Some developed economies maintained their low interests rates, such as the United States, the European Union, Japan and Britain.

The interest rate hikes will have limited impacts on commodities markets as 0.25 percentages are not that significant, said Zhou Zhiqiang, head of Xiangyu Futures Research Institute.

But higher interests rates may attract more inflows of speculative "hot money" into China, fueling China's assets prices, Zhou said.

The hike may raise costs for property developers and mortgage home buyers and further cool down the property market in the fourth quarter, said Yang Hongxu, an analyst with Shanghai-based E-house China Research and Development Institute.

Yang expected the move would usher in a new round of interest hikes. The last round of interest hikes began in 2004 and gathered pace in 2007 - six times a year, but the moves only took effect in the fourth quarter of 2007 in cooling down the property market, Yang said.

The anticipated new round of interest rate hikes may influence the property market with its first move, as the home loan policies have been already tightened, Yang said.

China seeks to achieve a growth rate of around 10 percent and about 3 percent inflation in 2010.