PBOC to hold key rate steady on Friday, rate cut talks alive – Reuters poll

Dhwani Mehta FXStreet

The People’s Bank of China is expected to keep the one-year Loan Prime Rate (LPR) unchanged for the 16th straight month at its August fixing on Friday, the latest Reuters poll of 32 traders and analysts showed on Thursday.

Key takeaways

“Some traders and analysts believe a cut may be needed soon amid signs the country's economic recovery is losing steam.”

“78% of 32 participants, in the snap poll predicted no change in either the one-year Loan Prime Rate (LPR) or the five-year tenor.”

“The remaining seven respondents all expected a cut to the one-year LPR, with six participants predicting a 5 basis points (bps) reduction and one seeing a 10-bps cut.”

“Policy insiders told Reuters earlier in August that China is poised to quicken spending on infrastructure projects while the central bank supports the economy in other ways.”

Read: USD/CNH: Rising bets for a move above 6.5000 – UOB

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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