DBS Group Research economist Chua Han Teng expects the People’s Bank of China to keep the 1-year loan prime rate at 3.00% on Feb. 24, as January data is still emerging. The report said policy remains cautiously accommodative, reflected in USD/CNY fixing below 7.0, reliance on structural tools and expectations of widespread easing in the second half of 2026.
No change has been seen in the loan prime rate at present
“The PBOC is expected to keep the 1-year lending prime rate (LPR) unchanged at 3.00%, as January economic data is not yet fully out.”
“The central bank is maintaining a cautious monetary policy stance amid rising geopolitical tensions.”
“This trend is being reflected in lower USD/CNY fixing, which has broken the psychological 7.0 level.”
“The PBOC is relying more on structural tools to support targeted sectors rather than cutting the lending prime rate or the 7-day reverse repo rate.”
“We expect the PBOC to resume broad easing toward 2H.”
(This article was created with the help of an artificial intelligence tool and reviewed by an editor.)
