China held on to its benchmark lending rates for a second straight month on Thursday, in line with expectations, as policymakers avoided further monetary stimulus to avoid divergence with other major economies.
The one-year loan primary rate (LPR) was held at 3.65%, while the five-year LPR remained at 4.30%.
A Reuters poll showed 22 of 24 respondents projected there would be no change in the two rates, while the remaining two expected a marginal reduction to the five-year rate after the government adopted a series of measures to support the housing sector.
The LPR fixing came after the People’s Bank of China left the interest rate on its medium-term loans unchanged this week.
The cost of borrowing the medium-term credit instrument (MLF) serves as a guide for the LPR, and markets typically consider the medium-term rate to guide changes in lending benchmarks.
Source: CNN Brasil
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