People’s Bank of China Maintains Interest Rates to Foster Stability and Economic Expansion

The People’s Bank of China (PBOC) announced on Monday that it is keeping key market-based interest rates unchanged, maintaining the same levels as last month in a move aimed at preserving financial stability and encouraging economic activity.

According to the National Interbank Funding Center, the one-year loan prime rate (LPR) remains at 3.0%, while the five-year LPR — widely used as a reference for mortgage rates — stays at 3.5%.

China’s state news agency Xinhua reported that the unchanged loan prime rates reflect a continued effort to reduce borrowing costs for households and businesses, thereby providing stronger support for the broader economy.

Recent data shows that the average weighted interest rate for new corporate loans dropped to around 3.3% during the first half of 2025, a decrease of 45 basis points compared to the same period last year. Meanwhile, the interest rate on new personal mortgage loans also declined to approximately 3.3%, down by 60 basis points.

In alignment with its broader economic policy, China reaffirmed its commitment to a “moderately accommodative” monetary stance for 2025, as stated in this year’s government work report. This approach aims to balance growth support with the need for financial stability.