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MNI BRIEF: China Loan Prime Rate Cut 10bps To Boost Economy

MNI (Singapore)
(MNI) Beijing

China's Loan Prime Rate was cut on Tuesday to guide down funding costs and boost credit, according to a People's Bank of China statement.

The one-year LPR, based on the PBOC’s Medium-term Lending Facility rate and quotes submitted by 18 banks, was reduced to 3.55% from 3.65% and the five-year plus maturity was lowered to 4.2% from 4.3% – the first cut since last July. The rate cut was expected as the PBOC reduced the MLF rate last week to 2.65% from 2.75%, also the first cut since last July (see: MNI PBOC WATCH: MLF Rate Cut In Sight After Repo Move).

Policy advisors and economists are expected to unveil further stimulus to bolster real estate, consumption and investment to sooth concerns over the recovery's sustainability (see: MNI: PBOC Rate Cut Expectations Build After Deposit Cuts).

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