The People’s Bank of China left one of the country’s most important interest rates unchanged on Monday, defying expectations for further easing to boost a weak economy.
The rate on just under Rmb1tn ($140bn) of one-year loans to financial institutions, referred to as the medium-term lending facility, was held at 2.5 per cent.
Weaknesses across China’s economy, including deflation and a slowing real estate sector, had fuelled expectations of further cuts. In a Bloomberg poll, 14 out of 18 economists had expected a cut of at least 0.1 per cent.
Over the summer, authorities similarly exercised caution over rate cuts, focusing on pressures facing the country’s vast banking system.
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