China Keeps Benchmark Rates Unchanged
(RTTNews) - China's central bank kept its loan prime rates unchanged on Thursday, as widely expected, after lowering the rates last month.
The central bank maintained its one-year loan prime rate, or LPR, at 3.55 percent. Likewise, the five-year LPR, the benchmark for mortgage rates, was retained at 4.20 percent.
The bank has lowered both rates by 10 basis points in June.
Although Beijing has influence over the LPR, the central bank fixes it monthly based on the submission of 18 banks. The LPR replaced the traditional benchmark lending rate in August 2019.
The PBoC was widely expected to maintain the LPR today after the one-year medium-term lending facility, or MLF, rate was left unchanged early this week. The MLF acts as a guide to the LPR.
Earlier on Monday, the PBoC added CNY 103 billion into the banking system through one-year MLF at a rate of 2.65 percent. The central bank also conducted seven-day reverse repos of CNY 33 billion at an interest rate of 1.9 percent.
Official data showed that the economy logged a slower-than-expected growth of 6.3 percent in the second quarter, but faster than the 4.5 percent expansion in the first quarter. Nonetheless, growth stays well above Beijing's full year growth target of around 5.0 percent.
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