Bank of China lowered the rate on medium-term loans

China’s Central Bank on Monday lowered interest rates on loans granted in the framework of the medium-term lending (Medium-term Lending Facility, MLF), to support the company amid the outbreak of coronavirus.

the people’s Bank of China has provided loans for a period of one year in the amount of 200 billion yuan (of 28.65 billion) in the framework of MLF.

the Regulator said that the interest rate on one-year loans MLF reduced by 10 basis points — from 3.25% to 3.15%. On Monday the maturities of any loans MLF.

the Central Bank has also poured into the financial system 100 billion yuan in the 7-day reverse REPO at a rate of 2.4%. On Monday, the maturities of reverse REPO in the amount of 1 trillion yuan.

it is Expected that the Central Bank will also reduce a new benchmark — the annual interest rate on loans to Prime borrowers (loan prime rate, LPR) to reduce the cost of borrowing for companies and consumers.

in addition, it is expected that the Chinese government can increase budget spending and take measures to stimulate domestic consumption to support the economy, which has suffered from an outbreak of coronavirus COVID19.