China's Central Bank Holds Benchmark Lending Rates Steady

China
China's central bank has maintained its benchmark lending rates, with the one-year loan prime rate at 3.45% and the five-year LPR at 4.2%.
The decision to keep the rates steady is influenced by the weaker yuan, which continues to limit further monetary easing.
The International Monetary Fund forecasts China's economy to expand 5.4 percent this year before slowing to 4.6 percent next year.
The PBOC injected the most cash into the financial system since late 2016 through its one-year loans to meet liquidity needs.

China's central bank, the People's Bank of China (PBOC), has decided to maintain its benchmark lending rates, a move that aligns with market expectations. The one-year loan prime rate (LPR) remains at 3.45%, and the five-year LPR, which serves as a reference for mortgages, is retained at 4.20%. The last adjustment to these rates was a cut in August when the one-year LPR was lowered by 10 basis points.

The decision to keep the rates steady is influenced by the weaker yuan, which continues to limit further monetary easing. The central bank also kept its medium-term policy rate steady. The one-year LPR influences most new and outstanding loans in China. These rates are based on the interest rates that 18 banks offer their best customers and are published by the PBOC monthly.

In addition to maintaining the lending rates, the PBOC chose to inject the most cash into the financial system since late 2016 through its one-year loans. This move is intended to meet liquidity needs spurred by Beijing's move to support the economy via an unusual sale of sovereign bonds.

Despite recent economic data suggesting that the economy will avoid a substantial slowdown, the real estate market and unfavorable external conditions pose downside risks to growth. The International Monetary Fund forecasts China's economy to expand 5.4 percent this year before slowing to 4.6 percent next year.


Confidence

100%

No Doubts Found At Time Of Publication

Sources

97%

  • Unique Points
    • This decision is influenced by the weaker yuan, which continues to limit further monetary easing.
  • Accuracy
    No Contradictions at Time Of Publication
  • Deception (100%)
    None Found At Time Of Publication
  • Fallacies (100%)
    None Found At Time Of Publication
  • Bias (100%)
    None Found At Time Of Publication
  • Site Conflicts Of Interest (100%)
    None Found At Time Of Publication
  • Author Conflicts Of Interest (100%)
    None Found At Time Of Publication

97%

  • Unique Points
    • Instead, it chose to inject the most cash into the financial system since late 2016 through its one-year loans, intending to meet liquidity needs spurred by Beijing's move to support the economy via an unusual sale of sovereign bonds.
  • Accuracy
    No Contradictions at Time Of Publication
  • Deception (100%)
    None Found At Time Of Publication
  • Fallacies (100%)
    None Found At Time Of Publication
  • Bias (100%)
    None Found At Time Of Publication
  • Site Conflicts Of Interest (100%)
    None Found At Time Of Publication
  • Author Conflicts Of Interest (100%)
    None Found At Time Of Publication

97%

  • Unique Points
    • The last rate cut occurred in August when the one-year LRP was lowered by 10 basis points.
  • Accuracy
    No Contradictions at Time Of Publication
  • Deception (100%)
    None Found At Time Of Publication
  • Fallacies (100%)
    None Found At Time Of Publication
  • Bias (100%)
    None Found At Time Of Publication
  • Site Conflicts Of Interest (100%)
    None Found At Time Of Publication
  • Author Conflicts Of Interest (100%)
    None Found At Time Of Publication

97%

  • Unique Points
    • Despite recent economic data suggesting that the economy will avoid a substantial slowdown, the real estate market and unfavorable external conditions pose downside risks to growth. The International Monetary Fund forecasts China's economy to expand 5.4 percent this year before slowing to 4.6 percent next year.
  • Accuracy
    No Contradictions at Time Of Publication
  • Deception (100%)
    None Found At Time Of Publication
  • Fallacies (100%)
    None Found At Time Of Publication
  • Bias (100%)
    None Found At Time Of Publication
  • Site Conflicts Of Interest (100%)
    None Found At Time Of Publication
  • Author Conflicts Of Interest (100%)
    None Found At Time Of Publication