Fight inflation hard

The latest interest rate hike that China announced on Tuesday was surprising only in its timing. To sustain sound and stable economic growth, Chinese policymakers must take more measures to prevent inflation from escalating further.

For the third time since October, the People's Bank of China raised its benchmark one-year deposit rate by a quarter of a percentage point, to 3 percent, and its one-year lending rate by a similar amount, to 6.06 percent.

The timing of the announcement, at the very end of the lunar new year holiday, displays an extraordinary sense of urgency. Had the pressure of accelerating inflation not been so huge, Chinese central bank officials would not have needed to break their holiday to take action.