PBoC Cut the Rate on 1-Year Medium-Term Lending Facility
the People’s Bank of China (PBoC) cut the interest rate on its 1-year medium-term lending facility (MLF) to 2.95%
On April 15, 2020, the People’s Bank of China (PBoC) cut the interest rate on its 1-year medium-term lending facility (MLF) to 2.95% from 3.15%. Through this MLF operation, the central bank essentially provided liquidity worth RMB 100bn to the commercial banks.
Тhis cut could pave the way for lower Loan Prime Rates (LPR) in April to support the sluggish real economy, because after the interest rates liberalisation in August 2019, the LPR, the benchmark lending rate, is priced based on the MLF rate.
Detailed data and analysis on China’s Economy can be found in the CEIC China Economy in a Snapshot - Q1 2020.