China’s central bank left its key policy interest rates unchanged Wednesday after lowering benchmark lending rates in May to support the cooling economy.
The People’s Bank of China kept the interest rate of the one-year medium-term lending facility unchanged at 2.85% while injecting 200 billion yuan ($29.67 billion) of liquidity into the banking system via the MLF, according to a statement on its website.
It also maintained the interest rate of seven-day reverse repurchase agreements at 2.1% while injecting CNY10 billion of liquidity via the monetary tool, according to the statement.
The central bank last month cut the benchmark five-year loan prime rate to 4.45% from 4.6% in a bid to lower financing costs for struggling businesses.
Before the benchmark cut, the PBOC kept its MLF rates unchanged. Economists closely watch changes in the central bank’s MLF interest rates, used to price the LPR, to forecast possible changes in benchmark interest rates.
China’s major economic indicators improved in May, official data showed Wednesday, after Beijing eased its Covid-19 policy.
The PBOC’s next decision on the LPR is due Monday.