1. The People's Bank of China reduced the 1-year and 5-year Loan Prime Rates (LPR) by 0.1 percentage point each, affecting corporate loans and mortgage rates respectively.
2. This is the first cut to these benchmarks since October 2019. A lower rate serves as a stimulus for businesses and housing demand.
3. The reduction in rates comes amid weak domestic demand due to a prolonged real estate slump and ongoing trade war concerns with the United States.
A: Hey, did you catch the news?
B: Nope, what's up?
A: China's central bank just lowered interest rates for businesses and homes!
B: Really? When was that announced?
A: It happened on Tuesday. They cut the 1-year loan prime rate to 3.0% and the five-year rate to 3.5%.
B: Oh, I see. So these rates help businesses get loans and homes get mortgages, right?
A: Exactly! These changes are like their main benchmarks for those types of loans.
B: And they haven't done this since last October?
A: That's correct. They also lowered the short-term funding rate for commercial lenders back in May.
B: I see, it seems the Chinese economy isn't doing too well with weak demand and worries about a trade war with the US.
A: Yeah, that's what I heard. It looks like they want to give their economy a boost with these interest rate cuts.
China's central bank has further eased policy to shore up the sluggish economy, cutting interest rates for corporate and housing loans.
The People's Bank of China on Tuesday trimmed the 1-year loan prime rate, or LPR, by 0.1 point to 3.0 percent. Commercial lenders use the rate as a benchmark when giving loans to corporate clients.
The bank also cut the five-year LPR by the same margin to 3.5 percent. That rate serves as a yardstick for mortgages.
The cuts to those benchmarks are the first since October last year.
The central bank lowered the seven-day reverse repo rate for short-term funding to commercial lenders on May 8. The bank sees that as its main policy rate.
Domestic demand remains weak amid a prolonged real estate slump. Concerns also linger about a trade war with the United States as tariff negotiations continue between the two countries.
2. This is the first cut to these benchmarks since October 2019. A lower rate serves as a stimulus for businesses and housing demand.
3. The reduction in rates comes amid weak domestic demand due to a prolonged real estate slump and ongoing trade war concerns with the United States.
A: Hey, did you catch the news?
B: Nope, what's up?
A: China's central bank just lowered interest rates for businesses and homes!
B: Really? When was that announced?
A: It happened on Tuesday. They cut the 1-year loan prime rate to 3.0% and the five-year rate to 3.5%.
B: Oh, I see. So these rates help businesses get loans and homes get mortgages, right?
A: Exactly! These changes are like their main benchmarks for those types of loans.
B: And they haven't done this since last October?
A: That's correct. They also lowered the short-term funding rate for commercial lenders back in May.
B: I see, it seems the Chinese economy isn't doing too well with weak demand and worries about a trade war with the US.
A: Yeah, that's what I heard. It looks like they want to give their economy a boost with these interest rate cuts.
China's central bank has further eased policy to shore up the sluggish economy, cutting interest rates for corporate and housing loans.
The People's Bank of China on Tuesday trimmed the 1-year loan prime rate, or LPR, by 0.1 point to 3.0 percent. Commercial lenders use the rate as a benchmark when giving loans to corporate clients.
The bank also cut the five-year LPR by the same margin to 3.5 percent. That rate serves as a yardstick for mortgages.
The cuts to those benchmarks are the first since October last year.
The central bank lowered the seven-day reverse repo rate for short-term funding to commercial lenders on May 8. The bank sees that as its main policy rate.
Domestic demand remains weak amid a prolonged real estate slump. Concerns also linger about a trade war with the United States as tariff negotiations continue between the two countries.
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Summary
China's central bank reduced the 1-year and 5-year Loan Prime Rates (LPR) by 0.1 percentage point each, affecting corporate loans and mortgage rates respectively. This is the first cut since October 2019, aimed at stimulating businesses and housing demand amid weak domestic demand due to a
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ID: 576b43b2-3d7b-441e-8cf0-9886b3d6f690
Category ID: nhk
URL: https://www3.nhk.or.jp/nhkworld/en/news/20250520_B4/
Created: 2025/05/20 23:00
Updated: 2025/12/08 04:03
Last Read: 2025/05/21 16:37