China to Further Monetary Tightening

http://www.bloomberg.com/news/2011-04-17/china-raises-reserve-ratio-to-curb-inflation-as-zhou-pledges-more-to-come.html

With inflation happening at a quickening pace, China has begun to take action to keep inflation from increasing to much. To this end, China has increased its banks' reserve requirements, to lock up money and keep inflation down. This is a policy that the Central Bank Governor Zhou Xiaochuan said will continue "for some time," and foresees no absolute limits on how high the reserve requirement could reach. Raising reserve requirements ensures that banks do not engage in aggressive lending policies. Zhou claims China's monetary policy is continuing its move from moderate, to prudent.