Beijing, May 18:

China announced on Friday it will raise interest rates and widen the trading ban of its currency, in two much anticipated moves ahead of a crucial economic meeting in Washington.

The central bank also moved to cool the nation’s runaway economy and said it would raise the benchmark for one-year lending rates by 0.18 percentage points and hike the deposit rate by 0.27 percentage points.

The move was in order to ensure “reasonable growth” in credit and investments, and keep prices “basically stable,” the People’s Bank of China said.

It is the fourth time that China has raised interest rates, signalling its determination to cool down a liquidity-driven investment boom and a skyrocketing stock market.

The central bank also said that it would hike the required reserve ratio by 0.5 percentage point with effect from June 5.