China Keeps Lending Rates Steady as Trade Tensions with U.S. Escalate

The People's Bank of China maintains financial stability by holding key rates unchanged, balancing economic challenges and currency pressures.

The one-year loan prime rate (LPR) remains at 3.10%, and the five-year LPR stays at 3.60%, in line with market expectations.
China's central bank prioritizes financial and currency stability, limiting monetary easing despite economic uncertainties and deflationary pressures.
The yuan has weakened 2.5% against the U.S. dollar since Donald Trump's November election, with new U.S. tariffs adding strain to U.S.-China trade relations.
January saw a record 5.13 trillion yuan in new loans issued, but credit demand growth slowed compared to the previous year.
Analysts suggest further monetary policy adjustments, such as reserve requirement ratio (RRR) cuts, may occur later in 2025.