China kept its loan prime rate (LPR) unchanged for a fifth straight month. The LPR effectively serves as the benchmark interest rate in China.
On Oct. 20, the People's Bank of China, the Central Bank, announced it would keep the one-year LPR, the benchmark for general loans, at 3.0%, and the five-year LPR, the benchmark for mortgage loans on dwellings, at 3.5%.
In China, 20 major commercial banks submit rates to the interbank funding center each month after considering their own funding expense and risk premiums; the People's Bank of China then reviews the compiled LPR and publishes it for use as the de facto benchmark rate.
Earlier, as the slump in domestic demand and real estate prolonged, authorities cut the LPR by 0.25 percentage points in Oct. last year, followed by an additional 0.1 percentage point reduction in May this year as part of stimulus efforts.