The building of the Chinese People's Bank (PBOC) in Beijing in China, on Thursday, December 15, 2022.
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China expected the loan rates not to change Monday, with an annual LPR at 3.1% and 5 years at 3.6%, because the central bank spends
The decision from the People's Bank of China comes when China reported better than expected economic data this month, from GDP in the first quarter is growing by 5.4% year on yearallowing you to maintain rates.
Retail sales and industrial products in March also overcome the expectations of economists surveyed by Reuters.
1-year LPR affects corporate and most household loans in China, while the 5-year LPR serves as a reference point for mortgage rates. PBOC has maintained LPRS constant since October last year.
After announcement, Chinese Juan on land Trade was flat by 7,2995 in relation to the dollar, while Juan at sea slightly strengthened to 7,2962 against Greenback.
The suspension was in line with the Reuters survey Economists, from 87% expected PBOC to maintain permanent rates.
Dutch bank Last week, it was also forecasted that PBOC would probably maintain the rates, and Lynn Song and Min Joo Kang analysts indicated that LPR would rather not change without a restriction of the 7-day repo rate.
. 7-day repo rate It is currently 1.5%and has recently been reduced by 20 base points in September.
However, ING also said: “Low inflation and strong external winds per head in connection with the escalating tariff threats are a strong argument for alleviating. But the considerations of currency stability may lead the Chinese People's Bank to wait for the USA federal reserve reduce the cost of the loan.”
The United States imposed tariffs up to 245% on Chinese import, while China hit 125% of duties on US import.
While the number of GDP growth was encouraging, consumer prices in the second largest economy in the world remained in the deflating territory, with CPI reading in March showing that prices have dropped by 0.1% year on year.
Producers' prices fell by 2.5%in March, marking the 29th month in a row in a definition territory and seeing the greatest contraction from November 2024.