Xia Bin: Do Not Rule Out Further Interest Rate Increase

Xia Bin, director of the Financial Research Institute of the State Council Development Research Center (micro-blog), attended the 9 HSBC in Shanghai.

Xia Bin said that 2011 was a "policy adjustment year", monetary policy from loose to stable, investment policy is also emphasized the central and western regions and strategic industries.

For the regulation and control efforts, he believed that the direction of adjustment should not be loosened. The whole direction of adjustment is correct. At the same time, some initial results have been achieved. In the face of the difficulties and contradictions exposed in the regulation, we can not retreat or swaying in terms of regulation and control.

For the current negative real interest rate problem in the market, Xia Bin believes that according to the current economic and financial development, we still can not rule out the possibility of further raising interest rates.

Raising interest rates will help stabilize prices expectations, but it must also be clear that raising interest rates is only a means of price and a tool of central bank regulation. It still does not exclude that central banks will use more quantitative tools, including buying and selling central bank bills and raising deposit reserve ratio.

Xia Bin also mentioned how to make good use of huge foreign exchange reserves.

He believes that to promote enterprises to go out faster, to buy resources, energy and other related issues are very complex, but the direction needs to be accelerated, to promote the diversification of foreign exchange reserves application process.