China adds liquidity via reverse repos, cuts benchmark lending rate

22 Aug '22

1 min read

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The central bank in China recently conducted 2 billion yuan ($293.3 million) of reverse repos to maintain stable liquidity in the banking system. The People's Bank of China (PBOC) set the interest rate for the seven-day reverse repos at 2 per cent. It also cut the market-based benchmark lending rate to boost growth.

The one-year loan prime rate (LPR) was 3.65 per cent today, down from 3.7 per cent, according to the National Interbank Funding Centre.

The over-five-year LPR, on which many lenders base their mortgage rates, was lowered by 15 basis points to 4.3 per cent, official Chinese media reported.

The reduction followed the cut in the over-five-year rates in May.

The bank cut the interest rates of its medium-term lending facility (MLF) loans by 10 basis points last week, the second such move this year.

ALCHEMPro News Desk (DS)

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