China's central bank, the People's Bank of China (PBC), has decided to further raise the deposit interest rate of US and Hong Kong dollars starting Saturday, bank sources said on Friday.

The deposit interest rate of one-year US and Hong Kong dollars will be hiked to 2.5 percent and 2.375 percent from 2 percent and 1.875 percent respectively, up 0.5 percentage points.

The move came after the United States Federal Reserve lifted the US dollar deposit interest rate recently.

This is PBC's fourth time to have raised the interest rate of one-year deposits of US dollars this year.

On May 20, the bank lifted the interest rate of one-year deposits of US dollar by 0.25 percent. The rate was raised by another 0.5 percentage points to 1.625 percent on July 21. Also on that day, the PBC announced the abrupt appreciation of the Chinese currency, the yuan or RMB, by a moderate 2.1 percent.

It is widely believed that the PBC move aims to attract the deposit of foreign currencies, which have seen a sharp drop since the revaluation of the yuan.

(Xinhua News Agency October 15, 2005)