The People's Bank of China has kept its loan prime rates at 3.0% for one-year loans and 3.5% for five-year loans amidst slowing credit growth and significant deflationary pressures.
Economic Situation in China
The PBOC set the loan prime rate at 3.0% for one-year loans and 3.5% for long-term loans, keeping these rates in place until the next adjustment. Last month, authorities in China cut lending rates for the first time in seven months to help stimulate the economy.
Experts' Opinions on Future Rates
Bruce Pang, an adjunct professor at CUHK Business School, noted that recent comments from Chinese policymakers indicate a high level of satisfaction with current monetary policy. He added that officials are increasingly leaning towards a 'restrained, supporting role' for interest rate cuts.
Prospects for Monetary Policy Adjustments
Ho Woei Chen, an economist at UOB, claimed that near-term economic stabilization depends on reaching a trade deal with the U.S., which takes precedence over more aggressive policies. Discussions about a potential cut to the reserve requirement ratio are ongoing.
Thus, the People's Bank of China maintains its current rates amid a complex economic situation, contemplating further stimulation measures in response to domestic and external challenges.
