China cuts short-term loan rates in bid to stimulate economy

The People’s Bank of China on Tuesday cut a key short-term policy rate as it an economy stalling after the reopening from the Covid-19 pandemic failed to maintain momentum.

The PBOC cut its seven-day reverse repurchase rate by 10 basis points to 1.9% from 2% and injected 2 billion Chinese yuan ($280m) through its seven-day repos.

It is the central bank’s first such move since August and follows the nation’s largest banks cutting deposit rates last week.

The PBOC’s decision on its medium-lending facility interest rate is expected to be released on Thursday. Meanwhile, the bank’s loan prime rate is scheduled for release on June 20.

Reporting by Frank Prenesti for Sharecast.com