The authorities of the People’s Bank of China (PBOC) blamed the United States for a recent slump in the global stock market. The Chinese financial regulator believes that the plans of the US Federal Reserve to tighten its monetary policy became the main cause of the market fall. This opinion was expressed by Yao Yudong, head of the financial research institution of the PBOC. He has pointed out that coming interest rate hike in the US has already become a serious problem for the global markets and may even become a reason for another world’s financial crisis. Mr. Yudong also added that the expected Fed rate hike next month had been the "trigger" for the wild market swings. The economist said that a real interest rate hike could accelerate the plunge in US stocks that in its turn could lead to massive asset sell-off worldwide, thus sparking a large-scale financial crisis. Mr. Yao recommends the Fed to remain patient before the US inflation reaches its target of 2%.
