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China leaves benchmark lending rates unchanged as expected By Reuters

China leaves benchmark lending rates unchanged as expected

© Reuters. FILE PHOTO: Paramilitary police officers stand guard in front of the headquarters of the People’s Bank of China, the central bank (PBOC), in Beijing, China September 30, 2022. REUTERS/Tingshu Wang/File Photo

SHANGHAI/SINGAPORE (Reuters) – China kept benchmark lending rates unchanged at a monthly fixing on Wednesday, matching market expectations, as fresh signs of economic stabilisation and a weakening yuan constrained further monetary easing efforts.

The one-year loan prime rate (LPR) was kept at 3.45%, while the five-year LPR was unchanged at 4.20%.

In a Reuters survey of 29 market analysts and traders, all participants predicted no change to the one-year LPR, while a vast majority of them also expected the five-year rate to remain steady.

Most new and outstanding loans in China are based on the one-year LPR, while the five-year rate influences the pricing of mortgages.

China cut the one-year benchmark lending rate in August but surprised markets by keeping the five-year rate unchanged.

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