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πŸ‡¨πŸ‡³ China holds rates steady even as new loans unexpectedly contract by Β₯340bn

πŸ‡¨πŸ‡³ China holds rates steady even as new loans unexpectedly contract by Β₯340bn

China's central bank held benchmark lending rates unchanged for a 15th straight month even as new bank loans unexpectedly contracted by 340bn yuan in July, only the third negative print this century, with household and corporate borrowing shrinking despite multi-decade-low rates.

Line chart of PBoC 1-year and 5-year LPR from 2016 to 2026, stepping down to 3% and 3.5%.
China's 1-year and 5-year loan prime rates have now been frozen since May 2025, leaving Beijing reliant on fiscal and targeted tools as July activity cooled. Source

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