China cuts key lending rates
reportedMehr News Agency, with the aim of reviving the country’s economy, and continuing the interest rate reduction process that started last month, the initial one-year loan rate has been reduced by 25 points to 3.1 percent from 3. reached 35%, while the five-year loan interest rate with the same margin decreased to 3.6% from 3.85% previously. Lending rates last fell in July.
Pan Gong Sheng, president of the People’s Bank of China, told a financial forum last week that lending rates will be cut by 20 to 25 basis points on October 21.
On September 24, the central bank cut banks’ reserve requirement ratio by 50 basis points and the seven-day reverse repo rate by 20 basis points, the most aggressive stimulus since the pandemic corona is counted so far and includes measures to support the ailing real estate sector and increase consumption. Also, last month, the medium-term loan facility rate decreased by 30 points.
Most new and outstanding loans in China are one-year, while the five-year rate affects mortgage pricing. Since easing policies were implemented on September 24, the CSI300 (Shanghai and Shenzhen) index has broken records for daily moves, rising more than 14% overall. . During this period, the yuan has decreased by 1% against the dollar.
However, stocks have suffered in recent sessions as initial enthusiasm has given way to concerns about whether policy support will be enough to revive China’s economic growth. It has fluctuated.
Data on Friday showed China’s economic growth was slightly better than expected in the third quarter, although property investment fell more than 10 percent in the first nine months of the year. Retail sales and industrial production increased in September.
Officials expressed confidence at a press conference on Friday that the economy can meet the government’s annual growth target of around 5 percent and announced another reduction in bank reserves by the end of the year.
