China's central bank announced Wednesday a 0.3125 percentage point hike in the upper limit of the interest rate for one-year US dollar deposits.

Beginning Nov. 18 the rate will be raised to 0.875 percent.

The People's Bank of China, or the central bank, will no longer set upper limits for two-year deposits denominated in US dollar, euro, Japanese yen or Hong Kong dollars. The rate will instead be decided by commercial banks themselves, a fresh move to liberalize the interest rates.