China held lending rates unchanged for a 16th straight month while the yuan hit its strongest level since January 2023, a goodwill signal ahead of Thursday's Trump-Xi summit. Retail sales, investment, and producer prices all missed the mark.
With the Fed still tight and credit demand weak, Beijing’s 16-month LPR freeze leaves little room for a broad cut and points to more selective sector support instead. Source
The People's Bank of China (PBOC) left its loan prime rates (LPR), the benchmark reference rates banks use to price new loans, unchanged on Saturday for a 16th straight month. The one-year LPR holds at 3.0%, the five-year-plus rate at 3.5%. Every one of the 21 economists surveyed by Reuters called it correctly, and the PBOC's own commentary pointed to already-cheap credit as the reason: the weighted average rate on new corporate loans ran below 3% in August, about 20 basis points lower than a year earlier.
