China Keeps Key Lending Rates Unchanged

(RTTNews) - China's central bank left its loan prime rates unchanged on Wednesday, as widely expected, as authorities monitor developments in the housing market and credit growth.

The People's Bank of China kept the five-year loan prime rate at 3.95 percent after lowering it by 5 basis points in February. The one-year LPR was retained at 3.45 percent.

The 5-year LPR was reduced in February to support the ailing housing market. The PBoC fixes the LPR monthly based on the submission of 18 designated banks. However, Beijing has influence over the fixing.

The LPR replaced the traditional benchmark lending rate in August 2019.

The status quo decision was widely expected as the medium-term lending facility, which is considered as a guide to loan prime rate, was left unchanged last week.

Data released this week showed an improvement in industrial production but retail sales posted a slower growth in January to February period.

The Chinese government aims to achieve growth target of around 5 percent in 2024. However, stimulus measures are likely to be needed to reach its goal.

The bank had lowered the reserve requirement ratio by 50 basis points with effect from February.