SHANGHAI — China kept benchmark lending rates unchanged on Monday, as forecast, after it reported slightly better-than-expected second-quarter economic data.
Why it is important
Signs of economic resilience effectively reduced any urgency for further stimulus, while analysts widely expect persistent weak domestic demand warrants some monetary easing later this year.
By the numbers
The one-year loan prime rate (LPR) was kept at 3.0 percent, while the five-year LPR was unchanged at 3.5 percent.
In a Reuters survey of 20 market participants conducted last week, all participants predicted no change to either of the two rates.
Most new and outstanding loans in China are based on the one-year LPR, while the five-year rate influences the pricing of mortgages.
Context
China’s economy slowed less than expected in the second quarter in a show of resilience against US tariffs, though analysts warn weak demand at home and rising global trade risks will ramp up pressure on Beijing to roll out more stimulus.
