Core Viewpoint - The recent reduction in the Loan Prime Rate (LPR) and deposit rates by major banks is expected to stimulate the real economy and support high-quality development in the banking sector [2][5][8] Group 1: LPR Adjustment - The LPR for one year and five years has decreased by 10 basis points to 3% and 3.5% respectively, marking the first adjustment of the year [1][3] - The adjustment follows a reduction in the 7-day reverse repurchase rate by 10 basis points, which is now seen as a new pricing anchor for the LPR [4][3] - The LPR's decline is part of a broader monetary policy easing aimed at reducing borrowing costs for medium to long-term financing [5][8] Group 2: Deposit Rate Changes - Major banks, including six state-owned commercial banks, have lowered their RMB deposit rates by 5 to 25 basis points [1][6] - The adjustments include a 5 basis point reduction in demand deposit rates and a 15 to 25 basis point reduction in various term deposit rates [6][7] - This move is anticipated to help banks lower funding costs and stabilize net interest margins, enhancing their ability to support the real economy [7][8] Group 3: Impact on the Real Economy - The dual reduction in lending and deposit rates is expected to lower overall financing costs, thereby encouraging investment and production [8] - Continuous policy support from fiscal, monetary, and industrial sectors is enhancing market confidence and directing more funds towards capital markets and real enterprises [8] - The banking sector is urged to utilize various structural monetary policy tools to direct credit resources towards key areas of the real economy [8]

Core Points - The People's Bank of China announced a decrease in the Loan Prime Rate (LPR) for both 1-year and 5-year terms, with the 1-year LPR at 3.0% and the 5-year LPR at 3.5%, both down by 10 basis points from the previous period [1] - Multiple banks have also lowered their RMB deposit rates, which is expected to stabilize the net interest margin of commercial banks and effectively reduce the overall financing costs for the real economy [1][3] Group 1: LPR and Deposit Rate Adjustments - The recent LPR decrease aligns with market expectations, as the new monetary policy framework positions the 7-day reverse repurchase rate as the primary policy rate, facilitating the transmission of interest rates from short to long [2] - The reduction in LPR is anticipated to lead to a more significant decrease in loan rates for enterprises and residents, thereby lowering financing costs and promoting investment and consumption [2] - The simultaneous reduction in deposit rates by major banks, including the six largest state-owned banks, is a proactive measure to maintain stable interest margins amid historically low financing costs [3] Group 2: Economic Implications and Future Outlook - The average interest rate for newly issued corporate loans in April was approximately 3.2%, down about 4 basis points from the previous month and 50 basis points year-on-year, while the average rate for personal housing loans was around 3.1%, down 55 basis points year-on-year [3] - Experts suggest that if economic growth pressures increase in the second half of the year, there may be further room for LPR reductions, although expectations should be tempered regarding the pace and magnitude of future rate changes [4] - The current focus is on stabilizing interest margins and ensuring the sustainable operation of banks, with potential for further LPR declines if effective demand does not improve significantly [4]

Core Viewpoint - The People's Bank of China has lowered the Loan Prime Rate (LPR) for both 1-year and 5-year terms by 10 basis points, indicating a transmission of policy rate adjustments to loan market rates [1][3][4]. Group 1: LPR Adjustments - The 1-year LPR is now 3.0% and the 5-year LPR is 3.5%, both down by 10 basis points from the previous period [1][3]. - Analysts believe there is still room for further LPR reductions to enhance the quality and accuracy of LPR quotes [5][6]. - The recent LPR adjustments align with a broader monetary policy shift aimed at reducing financing costs for businesses and households [4][6]. Group 2: Deposit Rate Cuts - A new round of deposit rate cuts has been initiated, with major banks reducing rates for various terms, including a 15 basis point cut for 3-month, 6-month, and 1-year deposits, and a 25 basis point cut for 3-year and 5-year deposits [1][7]. - The latest adjustments mark the seventh round of deposit rate cuts since the market-oriented adjustment mechanism was established in April 2022 [7][9]. - The reduction in deposit rates is expected to increase the difficulty for banks in attracting deposits, while simultaneously directing more funds into low-risk asset management products [2][8]. Group 3: Market Implications - The decline in deposit rates may lead to a further drop in broad interest rates, including government bond yields, and could encourage a "deposit migration" trend as investors seek higher returns [2][8]. - The anticipated increase in the scale of wealth management products could surpass 33 trillion yuan this year due to the lower deposit rates [2][8]. - The adjustments are part of a broader strategy to stabilize the economy amid external pressures and to stimulate domestic demand [4][6].

Core Points - The People's Bank of China has lowered the Loan Prime Rate (LPR) by 10 basis points, with the 1-year LPR now at 3.00% and the 5-year LPR at 3.50% [2][5] - Major banks have collectively reduced their deposit rates, with the interest rate for demand deposits dropping to 0.05% and the 1-year deposit rate falling below 1% to 0.95% [9][12] - The reduction in LPR is expected to lower monthly mortgage payments, with a decrease of approximately 54 yuan for a 1 million yuan loan over 30 years [8][4] Loan Market - The recent LPR adjustment was anticipated following a series of financial policies announced by the central bank [4] - The LPR reduction is aimed at supporting the real economy and stabilizing the banking sector's profitability by maintaining net interest margins [3][13] Deposit Market - The adjustment in deposit rates marks the first significant change in 2025, with various term deposit rates also being lowered [9][12] - The new rates for term deposits include 0.65% for 3-month deposits, 0.85% for 6-month deposits, and 1.05% for 2-year deposits [11][12] Economic Context - The LPR cut is a response to external economic pressures, particularly the escalation of the US-China trade conflict, necessitating increased counter-cyclical adjustments to stabilize economic performance [8][14] - Analysts predict that further monetary easing may occur later in the year if domestic economic growth remains under pressure [13][14]

5 月 20 日，央行公布 1年期、5 年期贷款市场报价利率（ LPR ）： 1年期LPR报3%，上次为3.1%；5 年期以上品种报3.5%，上次为3.6%。 | 公布日期 | 降息幅度(BP) | | | --- | --- | --- | | | 1年期 | 5年期以上 | | 2025-05-20 | 10 ▼ | 10 ▼ | | 2024-10-21 | 25 V | 25 ▼ | | 2024-07-22 | 10 ▼ | 10 ▼ | | 2024-02-20 | 0 C | 25 ▼ | | 2023-08-21 | 10 ▼ | 0 0 | | 2023-06-20 | 10 ▼ | 10 ▼ | | 2022-08-22 | 5 V | 15 ▼ | | 2022-05-20 | 0 € | 15 ▼ | | 2022-01-20 | 10 ▼ | 5 V | | 2021-12-20 | 5 V | 0 C | | 2020-04-20 | 20 ▼ | 10 ▼ | | 2020-02-20 | 10 V | 5 ▼ | | 2019-11-20 | 5 ▼ | 5 A | | 201 ...