Economics
Chinese Banks Cut Borrowing Costs To Counter Economic Slowdown
- Interest rate for 1-year loans lowered to 3.8% from 3.85%
- Cut comes after RRR cut which freed up money for banks to lend
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Chinese banks lowered borrowing costs for the first time in 20 months, foreshadowing more monetary support to an economy showing strain from a property slump, weak private consumption and sporadic virus outbreaks.
The one-year loan prime rate was set at 3.8% versus 3.85% in November, the first reduction since April 2020, according to a statement from the People’s Bank of China on Monday. The five-year loan prime rate, a reference for mortgages, was unchanged at 4.65%.