The People’s Bank of China will announce the one- and five-year loan prime rates on Monday, July 22, 2024. The announcement is usually on the 20th, but since that day was a Saturday, it will be today instead.
Last week, the Monthly Medium Term Lending Facility (MLF) was established.
When the People’s Bank of China leaves the MLF rate unchanged, it is often a signal that the LPR will also remain unchanged, but this is not always the case.
The current LPR rates are:
3.45% for 1 year, 3.95% for 5 years
People’s Bank of China’s Prime Lending Rate (LPR):
The interest rate benchmark used in China. It is set monthly by the People’s Bank of China. The LPR serves as a reference rate for banks to determine interest rates for (mostly new) loans to customers. Most new and outstanding loans in China are based on the 1-year LPR, while the 5-year rate influences mortgage pricing. The LPR is calculated based on interest rates submitted daily to the PBOC by a panel of 18 selected commercial banks in China. The panel consists of both domestic and foreign banks, and each bank’s contribution is assigned a different weighting based on its size and importance in China’s financial system. The LPR is based on the average rate submitted by these panel banks, with the highest and lowest rates filtered out to reduce volatility and manipulation. The remaining rates are ranked and the median becomes the LPR. This snapshot is taken from the ForexLive Economic Data Calendar, which can be accessed here. Times in the left-most column are GMT. Numbers in the right-most column are the results for the “previous” (previous month/quarter, in some cases). The numbers in the column next to it are the expected consensus medians, if any.
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