China Cuts Interest Rates Again     

The People's Bank of China cuts interest rates, effective October 30th, 2008, which is the second time in three weeks, aiming to boost the economic growth.
   The benchmark one-year deposit interest rate dropped to 3.6% from 3.87%, while the one-year lending interest rate was lowered to 6.66% from 6.93%.
   Analysts say that the drastic economic slowdown in the past months is crying for an expanding monetary policy to spur the economic growth.
   The downturn global economy has caused a weak demand for domestic products. Ten thousand of domestic small- and medium- enterprises have closed down in the past months. The housing and real estate sector has seen a slump since this May. China's GDP growth dropped to 9.9% during January to September 2008, the first time below double digits for the past 60 months.
   Cutting interest rates will cut capital cost for lenders and increase their profit margin as well as help restore confidence in the face of the awful global economy.
   Economists expect the government will formulate more policies to stimulate domestic demand in the coming months and push the economic growth.