PBoC keeps one-year and five-year loan prime rates unchanged at 3% and 3.5%.

PBoC keeps one-year and five-year loan prime rates unchanged at 3% and 3.5%.

The People's Bank of China (PBoC) has maintained its one-year and five-year loan prime rates unchanged at 3% and 3.5% respectively, as expected. This decision comes amidst ongoing economic challenges and trade tensions between China and the United States [2].

The PBoC's decision to keep the rates unchanged is in line with recent monetary policy measures aimed at supporting the economy. Last month, the central bank reduced the one-year loan prime rate for the first time since October, and major state banks followed suit by lowering their deposit rates [3].

The current economic climate in China remains fragile, with growth forecasts being revised upwards due to the 90-day pause on tariffs agreed between Beijing and Washington [3]. However, economists caution that achieving the 5% growth target set by the government will require further stimulus measures [3].

The decision to keep the rates unchanged may signal that the PBoC is adopting a cautious approach, waiting to see how external geopolitical risks develop before taking further action. This strategy could help to stabilize the economy and protect commercial lenders' profit margins [3].

In the meantime, investors should continue to monitor economic indicators and trade developments closely, as these factors can have a significant impact on the Chinese economy and, consequently, global financial markets.

References:
[1] https://www.mitrade.com/insights/news/live-news/article-1-972787-20250721
[2] https://es-us.finanzas.yahoo.com/noticias/china-mantiene-cambios-tipos-inter%C3%A9s-065749217.html
[3] https://www.tbsnews.net/worldbiz/china/china-cuts-key-rates-aid-economy-trade-war-simmers-1147001