China Holds Lending Benchmarks For 6th Month

Mainland officials have kept the nation’s benchmark lending rates unchanged for a sixth straight month in February, as expected, with the world's second-largest economy showing more signs of recovery from a pandemic-induced slump.

A clutch of better-than-expected data recently suggests economic activity is rebounding as Beijing relaxed Covid measures in December.

The one-year loan prime rate (LPR) was kept at 3.65 percent, while the five-year LPR was unchanged at 4.30 percent.

"We expect the PBOC to stay accommodative in the first half of this year, but only through liquidity-related actions, not rate cuts," analysts at Barclays said in a note.

"Unlike the US and EU, China remains the outlier on monetary policy, with still benign inflation and recovering but still weak activity creating room for the PBOC to remain accommodative in the first half."

New bank loans on the mainland jumped more than expected to a record 4.9 trillion yuan in January as the central bank looks to kick-start recovery while new home prices rose for the first time in a year, as Beijing stepped up support for the property sector. (Reuters)