The central bank cotinues to keep the one-year loan prime rate at 3.85 percent, and the five-year LPR at 4.65 percent. China kept its benchmark lending rate for corporate and household loans unchanged at its December fixing today, as expected, although improving economic fundamentals have raised speculation about a rate increase next year. The one-year loan prime rate (LPR) was kept at 3.85 percent, while the five-year LPR remained at 4.65 percent. For the year, the one-year LPR was down a total 30 basis points of rate cuts, and the five-year rate was cut by 15 bps of two cuts in 2020. Most new and outstanding loans are based on the LPR, while the five-year rate influences the pricing of mortgages.

Source: The Standard December 21, 2020 02:37 UTC