China left the one-year loan prime rate unchanged at 3.65%, five-year loan prime rate unchanged at 4.30%

Ross J Burland FXStreet

China left the one-year loan prime rate unchanged at 3.65% and the five-year loan prime rate unchanged at 4.30% as expected as authorities held off unleashing more monetary stimulus to avoid stark policy divergence with other major economies as it battles with covid.

Reuters reported:

''A Reuters poll showed 22 out of 24 respondents predicted no change to either rate, while the remaining two expected a marginal reduction to the five-year rate after the government introduced a slew of measures to prop up the property sector.''

''Most new and outstanding loans in China are based on the one-year LPR, while the five-year rate influences the pricing of mortgages. China last cut LPRs in August.''

Meanwhile, Beijing had come under strict security measures ahead of the congress, sparking frustration in the city with a rare and dramatic public protest on Thursday criticising Mr Xi and zero Covid. Before the pandemic, China's growth was around 6%. Its most recent GDP figure was 0.4%. The local government knows that zero-Covid is tanking the economy.

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Ross J Burland

FXStreet

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

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