The 1-Year Loan Prime Rate has been cut to 3.65% (from 3.70%)

  • most new and outstanding loans in China are based on the one-year LPR
  • the previous cut to the 1-year was in January
  • the 5 basis point cut is not as much as the 10bp cut that was expected

The 5-Year Loan Prime Rate has been cut to 4.30% (from 4.45%)

  • most home mortgage rates are based on the five-year
  • the 5-year was last cut in May
  • the consensus expectation was for a 10 basis point cut, a 15bp cut is more than most were expecting


Loan prime rates are set by 18 designated commercial banks. Proposed rates are submitted by these banks to the PBOC.


I posted a preview here:

I posted this also:


The PBOC is trying to provide monetary policy support to China's economy. Economic growth is encountering headwinds from the imploding debt-laden property sector and ongoing rolling COVID-related restrictions and lockdowns. Tough times in China.