China central bank leaves key policy rate unchanged, as expected

Paramilitary police officers stand guard in front of the headquarters of the People’s Bank of China, the central bank (PBOC), in Beijing, China Sep 30, 2022. REUTERS/Tingshu Wang/File photo

SHANGHAI/SINGAPORE  — China’s central bank on Friday left a key policy rate unchanged as expected when rolling over maturing medium-term loans.

The People’s Bank of China (PBOC) said it was keeping the rate on 387 billion yuan ($53.80 billion) worth of one-year medium-term lending facility (MLF) loans to some financial institutions unchanged at 2.5 percent from the previous operation.

In a Reuters poll of 36 market watchers, 32, or 89 percent , of all respondents, expected the central bank to keep the borrowing cost of the one-year MLF loans unchanged.

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With 481 billion yuan worth of MLF loans set to expire this month, the operation resulted in a net 94 billion yuan fund withdrawal from the banking system.

The central bank also injected 13 billion yuan through seven-day reverse repos while keeping the borrowing cost unchanged at 1.8 percent , it said in a statement.

($1 = 7.1932 Chinese yuan)