BEIJING - China's central bank said Tuesday it will raise its benchmark one-year lending and deposit rate by 0.25 percentage points effective from October 20.
The People's Bank of China (PBOC) said in a statement on its website that the one-year deposit rate will rise from 2.25 percent to 2.50 percent and the one-year lending rate will increase from 5.31 percent to 5.56 percent.
The rise had not been anticipated and might be related to impending economic figures of both September and the third quarter, said Jiang Chao, an analyst with Guotai Junan Securities.
"The September CPI may be high," Jiang said.
Yan Wei, an analyst with the Orient Securities Company Limited, said the long existence of negative interest rates (inflation higher than deposit interests rates) was one of the main reasons for the interest rate hike.