(Finance) – This morning China lowered its key benchmark lending rates by 25 basis pointsin a move anticipated in recent days by the governor and which is part of Beijing’s package of stimulus measures to revive the economy.
In particular, the prime lending rate (LPR) at one year was lowered by 25 basis points to 3.10% from 3.35%, while the LPR at five years it was cut by the same margin to 3.6% from 3.85% previously.
The one-year LPR influences loans to companies and most loans to families in China, while the five-year LPR serves as a benchmark for interest rates mortgages.
On Friday, the governor of the People’s Bank of China (PBOC), Pan Gongshenghad told a financial forum that lending rates would be decreased by 20-25 basis points on October 21.
Lending rates were last cut in July. On September 24, the central bank instead announced cuts to banks’ compulsory reserve ratio of 50 basis points and at the seven-day reverse repo rate of 20 points.
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