Financial News: China Keeps Key Interest Rates Unchanged

China Keeps Key Interest Rates Unchanged

12/22/2025 - 01:29:00 (RTTNews)

(RTTNews) - China maintained its benchmark interest rates for the seventh straight month, as widely expected, on Monday.

The People's Bank of China left its one-year loan prime rate unchanged at 3.0 percent on Monday. Likewise, the five-year LPR, the benchmark for mortgage rates, was retained at 3.50 percent.

The bank had reduced its both LPRs by quarter points in October 2024 and 10 basis points each in May.

The PBoC fixes the LPR monthly based on the submission of 20 designated banks. However, Beijing has influence over the fixing. The LPR replaced the traditional benchmark lending rate in August 2019.

At the Central Economic Work Conference, held earlier in December, policymakers said they will maintain a more proactive fiscal policy in the coming year. Earlier this month, the International Monetary Fund raised China's growth outlook, citing policy stimulus measures and reduced US-China bilateral tariffs. The lender upgraded economic growth for this year to 5 percent from 4.8 percent and that for next year to 4.5 percent from 4.2 percent.

The IMF team urged China to tackle imbalances through more macroeconomic policies and complementary reforms to reduce huge household savings.

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