China lowered the benchmark rates for the fifth time in three month.

KommentariiZero17.12.2008FRS USA lowered the base rate to a historic minimumaTsentrobank China lowered the benchmark rates in the country for the fifth time in the last three months, said agency Bloomberg. This time the rate on loans to decline by 0.27 percentage point to 5.31 per cent, while deposit rate will decrease by the same 0.27 percentage point to 2.25 percent. In addition, the Central Bank reduced the rate of mandatory reserves for banks on deposits, said AFP.
In recent months, rates on loans and deposits reduces most of the world, which greatly affected by the global financial crisis. This measure helps monetary authorities of different countries "inflated" the money market, as banks are still experiencing shortages of liquidity.
For example, in Japan's basic rate fell to 0.1 per cent, while in the U.S. - to record 0-0,25 per annum. The decision of U.S. Federal Reserve has already caused a drop in the dollar against major world currencies, primarily the euro. Investors fear that rates are too low cause a surplus of funds in the banking system. In addition, low interest rates for loans in the past considered to be one of the causes of global financial crisis.
Several European countries despite the general trend not only lowers rates, but also enhances them. They feared for the stability of local currencies, as well as trying to prevent a sharp jump in inflation. In particular, the Central Bank of Russia raised the refinancing rate to 13 per cent per annum. By the same measure resorted and Central Hungary, in late October, raising the stakes in the country to 11.5 percent. Then the Hungarian Central Bank has become progressively lowering the rate, bringing it to the end of December to 10 per cent per annum.
Central Bank of China, unlike other central banks the world, reduces the rate is fixed at 0.25, or 0.5 percentage points, but at 0.27, or 0.54 percentage point. The fact is that Chinese economists believe in the magic numbers. As the number 9 is considered sacred in China, the rates vary by the number of multiple of nine.