Central bank bumps up rates in 'mini-tightening'

China will likely tighten monetary policy next year while increasing policy flexibility to ensure sufficient credit supply and to prevent overtightening from hurting the economy, economists said on Thursday after the US Federal Reserve rate hike.

The People's Bank of China, the central bank, raised the rates of seven-day and 28-day reverse repo agreements (through which the central bank provides money to the market) and the rates of the medium-term lending facility and standing lending facility (monetary tools to adjust money supply) by 5 basis points on Thursday.

The PBOC's rate hikes, seen by some economists as a "mini-tightening", came hours after the Fed hiked the United States' benchmark interest rate by 25 basis points to a target range of 1.25 percent to 1.5 percent in the Fed's third rate hike this year.