Governor Zhou Xiaochuan of the PBoC said in a speech today that there is still room to use interest rates increases in the fight against inflation.  This was interpreted by many as suggesting that the government does not plan to increase the appreciation rate of the currency.  But he also said that China should lower its savings ratio to encourage more domestic consumption.  I am not sure that increasing interest rates will lower the savings rate, unless he means he will increase the lending rate without increasing the deposit rate.  Good news for banks, I guess, but not for depositors struggling with inflation.