Today, China's Central Bank (PBOC) has decided to increase the Repo Rate (which is the discount rate at which a central bank repurchases government securities from the commercial banks) to the fastest increase in six weeks, as the government aims to contain inflation risks in a secure area.

Moreover, inflation rates may exceed the government's target 6% during the month of June, where consumer prices rose 5.5% last month from a year earlier, compared with 5.3% in April, while the Chinese policy makers are using prices and quantitative tools, such as medium and long-term central bank bills, to rein in liquidity.