China’s central bank on Monday cut key policy interest rates, a move that could provide more support to the cooling economy.
The People’s Bank of China said it lowered interest rates of both one-year medium-term lending facility and seven-day reverse repurchase agreements by 10 basis points, while injecting liquidity via the two instruments.
The one-year MLF rate was lowered to 2.75% and the seven-day reverse repo rate was cut to 2.0%, the PBOC said.
Monday’s cuts may lead to a lowering of China’s benchmark lending rates–the Loan Prime Rate–later this month as they rates are priced based on MLF rates.
The central bank also injected 400 billion yuan ($59.3 billion) liquidity via the one-year MLF and CNY2 billion via seven-day reverse repos on Monday.