e interest rate regime on Saturday. It decided to use the loan prime rate (LPR), the price of loans banks offer to their best cli

ents, as a new reference for bank loans, instead of the existing one-year benchmark lending rate.亚博体育官方app千花网

The new LPR was reported for the first time on Tuesday at 4.25 percent for one-year loans, low

亚博体育官方app千花网女神会所er than the 4.35 percent one-year benchmark lending rate which has been unchanged since August 2015. The LP

R for five-year loans was at 4.85 percent, according to the National Interbank Funding Center.

Many analysts have seen the new measure as an alternativ亚博体育官方app千花网女神会所

e way of cutting overall interest rates. In response, central bank officials said the reform itself

cannot replace the monetary policy or other policies, but it can improve the effectiveness of monetary policy.

Sun Guofeng, head of the central bank’s Monetary Policy Department, said the market-oriented inte亚博体育官方app千花网女神会所

rest rate reform will not have a direct impact on the renminbi exchange rate. “The market rates are directly

亚博体育官方app千花网related to the exchange rate, but this reform is not involved with changes of market rates.”

He said the current interest rate spread between China and the United States “is within a comfortable zone”.

While many developed countries use monetary easing to spur econ亚博体育官方app千花网女神会所

omic growth, China is the only country among major economies to retain a normal mone

亚博体育官方app千花网tary policy, and the valuation of yuan-denominated assets is still at a relatively lower level. All of these factors can hel

p to maintain the renminbi exchange rate at a stable and adaptive level, Sun added.

Even under the new scheme, the interest rate level for mortgage loans will not decline, as the government will not ease the rea亚博体育官方app千花网女神会所

l estate control policy nor use real estate as a tool to stimulate short-term economic growth, said

Liu, who disclosed that the interest rate policy for personal mortgages will be revealed in several days.

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