The PBOC 1 and 5 year loan prime rate (LPR) setting decision is due at 0130GMT Tuesday 20 April 2021.
- 1 year expected 3.85%, prior 3.85%
- 5 year expected 4.65%, prior 4.65%
Expectations are the one-year LPR will be left unchanged for the rest of 2021. Its been unchanged since May 2020.
The LPR is set in reference to the rate on the PBOC’s medium-term lending facility (MLF), its a lending reference rate set monthly by 18 banks. The PBOC conducted MLF lending last week, and kept the rate unchanged. The past 3 times that the LPR was changed was preceded by a change in the MLF rate. Hence, an unchanged MLF rate is a signal the LPR rate will remain unchanged today. Latest surveys of analysts show expectations are the 1 year LPR will remain unchanged for the balance of this year at least – officials in China are wary of any interest rate move that may lead to a stifling of the post-pandemic economic recovery.