5-Year Loan Prime Rate Could Be Cut In December - Securities Daily

The 5-year Loan Prime Rate could be lowered at the December 20th fixing, according to the Securities Daily. The recent lowering of deposit rates by banks, coupled with a cut to the reserve requirement ratio last month, may lead to a lower 5-year LPR, the newspaper said. The 1-year LPR is likely to remain stable this month, given the current corporate loan rate is lower than housing loan rates, and various structural support policy tools have provided abundant liquidity. The People's Bank of China's Medium-Term Lending Facility injection in December, coupled with the use of tools such as Pledged Supplementary Lending, will help control banks’ marginal capital costs and support an increase in credit to the real economy, the paper said.