CHINA – The China bank interest rate per annum has been reduced to 3% from 3.1%, the first of its kind in 7 months on Tuesday. A five-year interest rate has been reduced to 3.5% from 3.6%.
These cuts marked the first reduction in rates since the central bank’s 25-basis-point cut in October, as the world’s second-largest economy seeks to grow further by a series of efforts.
The decision followed the US and China’s decision to lower the mutual tariffs by 115% as of May 14.
It also followed better-than-expected economic data by China, with the gross domestic product growing by 5.4% year-on-year in the first quarter.
Chinese retail sales rose below forecasts in April, indicating a slower domestic demand, while industrial output climbed above expectations, signaling that the effect of tariffs was smaller than anticipated.
After the Chinese bank’s decision, the yuan was broadly stable, trading at around 7.22 against the US dollar.