Latest news with #benchmark lending rates
Reuters
3 hours ago
- Business
- Reuters
China leaves benchmark lending rates unchanged, matching forecast
SHANGHAI, Aug 20 (Reuters) - China kept benchmark lending rates unchanged for the third consecutive month on Wednesday, meeting market expectations, as authorities signalled they are in no rush to deliver monetary stimulus despite a string of recent disappointing economic data. The steady LPR fixings highlighted the central bank's preference for targeted structural policies to support specific sectors of the economy, rather than resorting to broad-based monetary easing. A de-escalation in trade tensions between Washington and Beijing also reduced urgency for more stimulus, as the world's two largest economies agreed to extend a tariff truce for another 90 days. The one-year loan prime rate (LPR) was kept at 3.0%, while the five-year LPR was unchanged at 3.5%. In a Reuters survey of 23 market participants conducted this week, all participants predicted no change to either of the two rates. In the latest quarterly monetary policy report, the central bank said it would implement and refine moderately loose monetary policy while cautioning against funds idling within the banking system. A string of July data pointed to signs of economic slowdown. China's factory output growth slumped to an eight-month low last month, retail sales slowed sharply, and new yuan loans contracted for the first time in 20 years. China said last week that it would offer interest subsidies for businesses in eight consumer service sectors to support services consumption. ** HO WOEI CHEN, ECONOMIST, UOB "Authorities may place greater emphasis on more targeted measures on the property market and consumption demand such as the loan interest subsidy policy and trade-in subsidies." She expects a 10-basis-point rate reduction in the fourth quarter of this year, adding the "prospect of a further 50-basis-point cut to reserve requirement ratio (RRR) remains in place." China "must continue to exert efforts in macro policies and increase them at appropriate time to promote the continued implementation of existing and established policies while maintaining policy continuity and stability," the official People's Daily said in a commentary on Wednesday. It added that it will enhance policy flexibility to cope with changes in the external environment.
Yahoo
a day ago
- Business
- Yahoo
China expected to keep benchmark lending rates unchanged
BEIJING/SHANGHAI (Reuters) -China is expected to keep benchmark lending rates unchanged for the third straight month in August this week, a Reuters survey showed, despite a string of recent economic data suggesting the economy might lose some momentum. Rather than resorting to broad-based monetary easing, the central bank may instead place greater emphasis on structural policies aimed at specific sectors to support the economy, market watchers said. Meanwhile, Beijing's ongoing "anti-involution" campaign to get rid of industrial overcapacity could also help combat persistent deflationary pressure. The loan prime rate (LPR), normally charged to banks' best clients, is calculated each month after 20 designated commercial banks submit proposed rates to the People's Bank of China (PBOC). In a Reuters survey of 23 market watchers conducted this week, all respondents expected both the one-year and five-year LPRs to remain steady on Wednesday. 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 both rates by 10 basis points in May. "We don't expect a 'bazooka-style' stimulus, while we see targeted demand support in the second half of 2025," Citi analysts said in a note. "Structural policies could be a more important venue for the PBOC in the next few months compared with broad-based rate or reserve requirement ratio (RRR) cuts." China's new yuan loans contracted in July for the first time in 20 years as the economy struggled, falling well short of analysts' forecasts, but improvements in broader credit growth suggest the central bank is in no rush to ease policy. In the latest quarterly monetary policy implementation report, the central bank said it would implement and refine moderately loose monetary policy. "We should make good use of structural monetary policy tools to intensify support for scientific and technological innovation, boost consumption, support small and micro enterprises and stabilize foreign trade," the PBOC said. Sign in to access your portfolio
Reuters
a day ago
- Business
- Reuters
China expected to keep benchmark lending rates unchanged
BEIJING/SHANGHAI, Aug 19 (Reuters) - China is expected to keep benchmark lending rates unchanged for the third straight month in August this week, a Reuters survey showed, despite a string of recent economic data suggesting the economy might lose some momentum. Rather than resorting to broad-based monetary easing, the central bank may instead place greater emphasis on structural policies aimed at specific sectors to support the economy, market watchers said. Meanwhile, Beijing's ongoing "anti-involution" campaign to get rid of industrial overcapacity could also help combat persistent deflationary pressure. The loan prime rate (LPR), normally charged to banks' best clients, is calculated each month after 20 designated commercial banks submit proposed rates to the People's Bank of China (PBOC). In a Reuters survey of 23 market watchers conducted this week, all respondents expected both the one-year and five-year LPRs to remain steady on Wednesday. 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 both rates by 10 basis points in May. "We don't expect a 'bazooka-style' stimulus, while we see targeted demand support in the second half of 2025," Citi analysts said in a note. "Structural policies could be a more important venue for the PBOC in the next few months compared with broad-based rate or reserve requirement ratio (RRR) cuts." China's new yuan loans contracted in July for the first time in 20 years as the economy struggled, falling well short of analysts' forecasts, but improvements in broader credit growth suggest the central bank is in no rush to ease policy. In the latest quarterly monetary policy implementation report, the central bank said it would implement and refine moderately loose monetary policy. "We should make good use of structural monetary policy tools to intensify support for scientific and technological innovation, boost consumption, support small and micro enterprises and stabilize foreign trade," the PBOC said.
Yahoo
a day ago
- Business
- Yahoo
China expected to keep benchmark lending rates unchanged
BEIJING/SHANGHAI (Reuters) -China is expected to keep benchmark lending rates unchanged for the third straight month in August this week, a Reuters survey showed, despite a string of recent economic data suggesting the economy might lose some momentum. Rather than resorting to broad-based monetary easing, the central bank may instead place greater emphasis on structural policies aimed at specific sectors to support the economy, market watchers said. Meanwhile, Beijing's ongoing "anti-involution" campaign to get rid of industrial overcapacity could also help combat persistent deflationary pressure. The loan prime rate (LPR), normally charged to banks' best clients, is calculated each month after 20 designated commercial banks submit proposed rates to the People's Bank of China (PBOC). In a Reuters survey of 23 market watchers conducted this week, all respondents expected both the one-year and five-year LPRs to remain steady on Wednesday. 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 both rates by 10 basis points in May. "We don't expect a 'bazooka-style' stimulus, while we see targeted demand support in the second half of 2025," Citi analysts said in a note. "Structural policies could be a more important venue for the PBOC in the next few months compared with broad-based rate or reserve requirement ratio (RRR) cuts." China's new yuan loans contracted in July for the first time in 20 years as the economy struggled, falling well short of analysts' forecasts, but improvements in broader credit growth suggest the central bank is in no rush to ease policy. In the latest quarterly monetary policy implementation report, the central bank said it would implement and refine moderately loose monetary policy. "We should make good use of structural monetary policy tools to intensify support for scientific and technological innovation, boost consumption, support small and micro enterprises and stabilize foreign trade," the PBOC said. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
