China raises interest rates to cool overheating economy

China yesterday increased its interest rates for the first time in 18 months in an effort to rein in booming investment and credit growth that have the potential to destabilise what is now the world's fourth largest economy.
The unexpected increase in the People's Bank of China's one-year lending rate, to 5.85% from 5.58%, signals important changes in Beijing's policy priorities as it aims to support sustainable development of the economy against a background of strong growth, say economists.

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Tags: China | Economy | Beijing