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China still has room for further interest rate cuts: official

Published: 30 Mar 2009 18:58:27 PST

Mar. 31, 2009 (China Knowledge) - China still has room for further interest rate cuts, according to Zhang Jianhua, director of the research bureau of the People's Bank of China (PBOC).

China's consumer price index may end mostly flat this year, said Zhang, adding the CPI is not likely to keep falling in the coming months. Zhang noted the central bank has not yet cut the interest rates because money market rates have declined to quite low levels and lenders have abundant liquidity.

China may not suffer from deflation due to the strong loan growth and the government's RMB 4 trillion stimulus package, according to Zhang.

Zhang said the new RMB loans in March would still be high based on statistics for the first 20 days of this month and fast loan growth would continue in the following months.

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