THE People’s Bank of China, the nation’s central bank, raised key deposit and lending interest rates by 0.27 percentage points, effective yesterday, to bring investment and credit growth in check and help balance the economy.

The one-year benchmark yuan deposit rate rose to 2.79 percent from 2.52 percent and the one-year benchmark lending rate to 6.39 percent from 6.12 percent.

It is the third time the central bank has raised interest rates since last April. It has also raised banks’ required reserves five times since last June to help soak up liquidity generated by the country’s large balance-of-payments surplus.

“The rate increase is conducive to the reasonable growth of credit and investment, to stabilizing prices, to the stable operation of the financial system, to balancing growth and improving the structure of the economy, and to promoting the healthy but rapid development of the economy,” the central bank said in a statement on its Web site.

Economists had widely expected the People’s Bank of China to take further tightening measures soon following a batch of strong economic data for February that showed credit surging, factories rapidly expanding output, and exports growing 50 percent from a year earlier.

However, many of them had expected the central bank to wait a bit longer to carry out another interest rate rise.

“The timing is a surprise although I had been expecting an immediate interest rate rise by the end of the month,” said Zhu Jianfang, chief analyst at China Securities Research Co. Ltd. in Beijing.

“The recently published economic indicators for last month are feverishly high and the central bank needs to raise the cost of money in order to contain inflation and curb credit expansion,” he said.(SD-Agencies)