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November 27, 2008


Fast and Heavy-handed Rate Cuts

China Rate Cut Highlights Concern Over Slowdown, Unemployment

“The central bank cut the key one-year lending rate 108 basis points to 5.58 percent. The deposit rate fell by the same amount to 2.52 percent.”

Here’s a look at the three year deposit rate in China (where we park our RMB). It was possible to lock in 5.4% for nearly a year, a level at which our real returns were slightly less negative. :-)

This entry was posted on Thursday, November 27th, 2008 at 9:43 am (utc+8) and is filed under China.

4 Responses to “Fast and Heavy-handed Rate Cuts”

  1. Born2Code said:
    November 27th, 2008 at 12:11 pm

    what’s the reason for these odd numbers in the rates? 1.08? why the 0.08? i’ve always wondered about those rates.

  2. C. Maoxian said:
    November 27th, 2008 at 2:33 pm

    @Born2: Something to do with the number nine and the abacus? Or maybe divisable by three to make quarterly interest amounts easier to calculate? I’d love to know myself if anyone has a link to a clear explanation.

  3. luca said:
    November 28th, 2008 at 5:13 am

    hi,
    “The central bank cut the key one-year lending rate 108 basis points to 5.58 percent”. Us usual china rate cut is like “nebulosa” size. __Bye Luca

  4. auma said:
    November 28th, 2008 at 9:10 am

    Happy thanksgiving to all who celebrate it. On a lighter note, China gains yet another oldest record.. lol

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