China raises short-term interest rates in fresh tightening signal

Shanghai

CHINA'S central bank surprised financial markets on Friday by raising short-term interest rates on the first day back from a long holiday, in a further sign of a tightening policy bias as the economy shows signs of steadying.

While the rate increases were modest, they reinforced views that Chinese authorities are intent on both containing capital outflows and reining in risks to the financial system created by years of debt-fuelled stimulus.