China raises reserve requirement again

By Aaron Smith, staff writer


NEW YORK (CNNMoney.com) -- The People's Bank of China raised the reserve requirement ratio for its banks by a half-percentage point on Friday in an attempt to control the flow of new money and combat inflation.

China's increase is the second such move in days. The central bank also increased the reserve requirement ratio by 50 basis points on Nov. 10.

But China's central bank didn't touch interest rates. There has been much speculation around the world about a possible rate hike by China, and that has some investors on edge.

The reserve ratio increases are one method China can use to keep its strong economy from overheating.

But China's tightening comes as the Federal Reserve plans for more quantitative easing. The Fed plans to inject money into the economy by buying $600 billion in long-term Treasuries over the next eight months.

The Fed's plan has been attacked by many politicians and economists as a program that effectively undermines the value of the dollar. At the same time, U.S. officials have also been critical of China for keeping its own currency, the yuan, artificially low.  To top of page

Frontline troops push for solar energy
The U.S. Marines are testing renewable energy technologies like solar to reduce costs and casualties associated with fossil fuels. Play
25 Best Places to find rich singles
Looking for Mr. or Ms. Moneybags? Hunt down the perfect mate in these wealthy cities, which are brimming with unattached professionals. More
Fun festivals: Twins to mustard to pirates!
You'll see double in Twinsburg, Ohio, and Ketchup lovers should beware in Middleton, WI. Here's some of the best and strangest town festivals. Play
Overnight Avg Rate Latest Change Last Week
30 yr fixed4.20%4.27%
15 yr fixed3.27%3.21%
5/1 ARM3.53%3.38%
30 yr refi4.18%4.24%
15 yr refi3.26%3.20%
Rate data provided
by Bankrate.com
View rates in your area
 
Find personalized rates:
Index Last Change % Change
Dow 17,131.97 100.83 0.59%
Nasdaq 4,552.76 33.86 0.75%
S&P 500 1,998.98 14.85 0.75%
Treasuries 2.59 -0.00 -0.08%
Data as of 4:28am ET
Company Price Change % Change
Apple Inc 100.86 -0.77 -0.76%
Bank of America Corp... 16.71 -0.03 -0.18%
Yahoo! Inc 42.71 0.16 0.38%
Alcoa Inc 16.16 0.00 0.00%
Facebook Inc 76.08 1.50 2.01%
Data as of Sep 16

Sections

Scotland's independence vote is too close to call but those who want to keep Britain united won this year's campaign funding race by some distance. More

The FBI's new facial recognition system lets local police easily identify you. It will one day spot you from your iris, voice and the way you walk. More

Y Combinator president Sam Altman is teaching a startup class at Stanford with Silicon Valley heavy hitters as guest lecturers. Bonus: All the videos will be available for free online. More

Occupy Wall Street offshoot Strike Debt says it has abolished nearly $4 million in private student loan debt for students who attended Everest College, part of Corinthian Colleges. More

Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.