PBOC cuts the borrowing rate (LPR) for 1 year, 5 years

China’s central bank cut its reference interest rates on lending again on Thursday amid concerns about an economic downturn in the world’s second largest economy.

The People’s Bank of China cut the 10-year prime interest rate by 10 basis points from 3.8% to 3.7%.

The five-year prime interest rate on loans was reduced by 5 basis points from 4.65% to 4.6% – it was the first cut since April 2020, at the height of the coronavirus pandemic in the country.

Last month, PBOC cut the one-year prime interest rate on loans for the first time since April 2020.

Prime interest rates on loans affect lending rates for corporate and household loans in the country.

Most new and outstanding loans in China are based on a one-year LPR, but the five-year interest rate affects the pricing of mortgages, according to Reuters.

This is breaking news. Please check back for updates.

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