China’s central bank, the People’s Bank of China (PBOC), announced on February 20, 2025, that it would keep the Loan Prime Rate (LPR) unchanged. The one-year LPR remains at 3.45%, while the five-year LPR, which impacts mortgage rates, stays at 4.20%.

This decision highlights Beijing’s cautious approach to monetary policy as the economy shows signs of recovery. Recent data indicates a 5.2% GDP growth rate for 2024, but challenges in the property sector and weak consumer demand persist.

“The steady LPR reflects China’s focus on stability,” said Li Wei, an economist at Zhonghai Securities. “Further rate cuts may be considered if growth slows later in the year.”

Global markets reacted cautiously, with Asian stocks trading mixed and the yuan holding steady against the US dollar. Investors are now awaiting policy signals from the National People’s Congress in March.