China keeps key lending rates unchanged

China’s key one-year lending rate, a benchmark market-based lending rate, stood at 3% on Friday, unchanged from the previous month.

The key five-year lending rate, which many lenders rely on to set mortgage rates, also remained unchanged from the previous reading of 3.5%, according to the National Interbank Finance Center.

According to Xinhua, these latest developments follow a 0.1 percentage point decrease in benchmark market-based lending rates last month, the first decrease this year.

Key lending rates reflect the level of financing costs for households and businesses, with lower interest rates implying less burden on borrowers and stronger support for economic activity. The latest data showed that the weighted average interest rate on new business loans fell to around 3.2% in May, down 50 basis points year-on-year, while the rate on new personal mortgages fell to around 3.1%, a decrease of 55 basis points.

China has pledged to implement a moderately accommodative monetary policy through 2025, according to the government work report.

The country’s economy continued to expand steadily in May, as supportive policies helped maintain the recovery amid global uncertainty. The National Bureau of Statistics said that key economic indicators—industrial production, retail sales, investment, and services—maintained upward momentum in May, with employment continuing its steady trend.