The People's Bank of China announced a reduction in key lending rates to stimulate economic activity. This decision aims to support both corporate and consumer sectors within the country.

Central Bank of China's Decision

The People’s Bank of China (PBOC) lowered the benchmark lending rates by 25 basis points. The five-year loan prime rate was decreased from 3.85% to 3.6%, while the one-year rate was reduced from 3.35% to 3.1%. These measures aim to boost corporate loans and mortgages.

Statements from PBOC Governor

PBOC governor Pan Gongsheng indicated the rate cuts during a forum in Beijing. He also mentioned plans to reduce reserve requirements and other key rates as part of economic policy adjustments.

Impact on China's Economy

In September, the PBOC lowered the reserve requirement ratio by 50 basis points. According to China's National Bureau of Statistics, the economy grew by 4.6% in the third quarter, surpassing expectations. However, doubts remain about meeting the 5% growth target.

The PBOC's rate cuts are part of a broader strategy for economic stabilization. Analysts view these changes as an important step towards recovery but highlight the need for additional fiscal stimulus measures.