China holds benchmark lending rates steady

China’s benchmark lending rates were kept steady after the central bank held its key policy rates unchanged earlier this month, according to data released by the People’s Bank of China.

The one-year loan prime rate stayed at 3.45% while the five-year rate was left at 4.2%, said the PBOC.

Monday’s result was expected after the central bank surprised markets by holding the interest rate on its medium-term lending facility unchanged earlier this year. Markets had been pricing in a cut to the MLF rate after China’s commercial banks lowered their deposit rates, leaving room for lowering benchmark loan rates.

Chinese banks also price their LPRs based on MLF interest rates.

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