Raising benchmark interest rate, the katalyst to the stock market?

Raising benchmark interest rate, the katalyst to the stock market?
Jul 25, 2007 01:44
LEOPOLD219 Points: Join Date: Feb 7, 2007 Status: offline	News from Xinhua The central bank of China announced on July 20th to raise the benchmark interest rate by 0.27% as of July 21. When the announcement is made, the shares kept rising. Originally, the purpose of the move is to curb the heated economy, rationalize the growth of lending and investment and stablize the expectancy of inflation and price stability. However, it seems that the move did not work well. The shares bounced back and kept rising. This move became the katalyst to the crazy stock market. Why? What do you think of this move, a katalyst to the stock market?

Jul 25, 2007 01:44

LEOPOLD219
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Join Date: Feb 7, 2007
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News from Xinhua

The central bank of China announced on July 20th to raise the benchmark interest rate by 0.27% as of July 21. When the announcement is made, the shares kept rising. Originally, the purpose of the move is to curb the heated economy, rationalize the growth of lending and investment and stablize the expectancy of inflation and price stability. However, it seems that the move did not work well. The shares bounced back and kept rising. This move became the katalyst to the crazy stock market. Why?

What do you think of this move, a katalyst to the stock market?

Jul 25, 2007 21:57	#1
KATRINA Points: Join Date: Nov 29, 2004 Status: Offline	Well, I do not think that raising benchmark interest rate is the katalyst ot the stock market. Before the government adopted this measure, people had guessed that the interest rate would be raised. Thus, when it came out, less people feel surprised and the stock market has not been influenced much. To some extent, people are encouraged by this. That is why the shares are rising.

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