China Loan Prime Rate monthly setting, expected to be unchanged again, this would be the 14th consecutive month of steady LPRs.
1 year LPR expected 3.85%, prior 3.85%
5 year LPR expected 4.65%, prior 4.65%
The LPR is set in reference to the rate on the PBOC's medium-term lending facility (MLF). Its a lending reference rate set monthly by 18 banks.
(I posted all of the above earlier).
Via Reuters, this in brief from a longer piece:
- Twenty-two traders and analysts of all 28 participants predicted no change
- Four respondents expected an increase of 5 basis points to both tenors this month, while another two predicted a 5 basis points rate cut to the one-year LPR.
- Strong expectations for a steady LPR came as the People's Bank of China (PBOC) kept borrowing cost on one-year medium-term lending facility (MLF) loans unchanged this week.
- The MLF, one of the PBOC's main tools in managing longer-term liquidity in the banking system, serves as a guide for the LPR.
- "We believe the PBOC's policy will decouple from the FOMC," analysts at ANZ said in a note. "May's economic data signals downside risks to China's economic activity in the near term. Therefore, the relatively hawkish stance of the U.S. Federal Reserve is unlikely to have a bearing on China's monetary policy."
