London, Monday, 22 August 2022
In an effort to boost borrowing demand in the face of ongoing COVID-19 outbreaks and a persistent real estate slowdown, the People's Bank of China decreased its key lending prime rates (LPR) at the August fixing, the second decrease of the year.
The 5-year LPR, which affects the cost of home mortgages, was cut for the second time this year by 15 bps to 4.30%, while the one-year LPR, which is used for business and family loans, was decreased by 5 bps to a record low of 3.65%.
After July statistics revealed the Chinese economy was losing steam amid sluggish global growth, the central bank last week surprisingly cut the rate on the one-year medium-term lending facility (MLF) and another short-term liquidity tool.
(Source: People's Bank of China // Report by: The Decision Maker – Finance editors)