China Cuts Rate for Mid-Term Loan to Remedy Economy from Virus Outbreak
PBOC on Monday said that it was lowering the interest rates on mid-term loans to remedy the economic plummet from coronavirus.
The People’s Bank of China (PBOC) on Monday said that it was lowering the interest rates on mid-term loans to remedy the economic plummet from coronavirus.
A cut of 10 basis points from 3.25% to 3.15% will be on 200 billion yuan ($28.65 billion) worth of one-year medium-term lending facility (MLF) loans to financial institutions
Earlier this month, China’s central bank had announced that it would inject $174 billion via reverse repo operations to support its economy on the first opening day after the Lunar New Year Holiday.
The cut announced by PBOC on Monday is expected to pave the way for a cut in China’s benchmark loan prime rate (LPR), which will be announced on Thursday.
In addition, the PBOC also said that it injected 100 billion yuan of reverse repos to financial institutions on the same day, when a total of one trillion yuan worth of reverse repos, issued earlier this year, are due to expire.
Thailand’s Monetary Policy Committee also cut interest rates by another 25 basis points earlier this month to its record low at 1.00% to support the economy hit by coronavirus as well.