China’s central bank Wednesday kept its benchmark lending rates unchanged, in line with market expectations, despite rising financial risks amid slowing economic growth.
The People’s Bank of China said it held the one-year loan prime rate steady at 3.7% and the five-year rate at 4.45%, according to a statement published on its website.
The hold on the LPR was in line with market expectations, as the central bank also maintained its medium-term lending facility unchanged earlier this month. The MLF rates are used to price China’s benchmark lending rates.
While holding the benchmark rates steady was expected, analysts anticipated the central bank to undertake more easing to resolve rising financial risks stemming from the nation’s property market and several small lenders. Some economists expected the PBOC may slash banks’ reserve requirement ratio soon to replenish liquidity into the banking system.
Also on Wednesday, the PBOC injected 3 billion yuan ($444.9 million) of funds via its seven-day reverse repurchase agreements.