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Official dismisses rate hike talk

A central bank official said on Tuesday that a recent increase in interest rates for open market operations was influenced by market forces and should not be viewed in the same way as benchmark interest rate increases. The People's Bank of China raised the interest rates for reverse repurchase agreements (repos) by 10 basis points on Friday, triggering speculation that the move signaled an intention to raise benchmark interest rates. The reverse repo rate rises were "mainly the results of a market-oriented bidding process" and "had major differences with increases of benchmark deposit and loan interest rates," said Xu Zhong, head of the central bank's research bureau.