Despite slow progress in the past, market-oriented steps are expected in banking in the next five years

China should take more action to promote steady and unwavering marketization of the current rigid interest rate regime, a practice that is widely adopted in developed economies such as the United States and Japan.

Due to the influence of a complicated series of political and economic factors, no substantial progress has been achieved in this aspect during the period of the 11th Five-Year Plan (2006-2010). However, messages transmitted from a recent top Communist Party of China (CPC) conference indicate that the pace of rate marketization is expected to accelerate in the coming years.