China’s central bank kept its loan prime rates unchanged on Tuesday as the authorities focus on targeted support for specific sectors to bolster a slowing economy instead of broad policy easing.
The People’s Bank of China held its 1-year and 5-year loan prime rates at 3% and 3.5%, respectively, keeping them unchanged for an eighth straight month.
The 1-year rate influences most new and outstanding loans, while the 5-year benchmark affects mortgages.
The decision came as the world’s second largest economy lost its momentum in the final quarter of 2025, growing 4.5% year on year, the slowest pace since the reopening from stringent Covid curbs in late 2022.
In nominal terms, China’s GDP growth edged up to 3.8% year on year in the fourth quarter as deflation showed signs of easing, said Erica Tay, director of macro research at Maybank.
