SHANGHAI : China is widely expected to lower its benchmark lending rates on Monday, a Reuters survey showed, with a vast majority of participants predicting a deeper cut to the mortgage reference to lift the ailing property sector and the overall economy.
All 30 participants expected a cut to the five-year tenor, with 27, or 90 per cent of them, forecasting a reduction larger than 10 bps. Among them, 15 traders and analysts predicted a 15 bps cut, 10 forecast a 20 bps cut, and the remaining two tipped a 25 bps reduction. "We think this may translate to more transmission of easing into the real economy, via potential LPR cuts next week," said Peiqian Liu, chief China economist at NatWest, as the LPR is now loosely pegged to the central bank's medium-term lending facility rate.