China’s central bank cuts interest rates to boost economy

BANGKOK — China’s central bank has cut its prime rate on five-year loans and its one-year rate in a bid to revive its struggling property sector and revive a slowing economy.

The five-year rate, which is the benchmark for mortgages, was cut by 10 basis points, from 3.95% to 3.85%. The one-year rate was reduced from 3.45% to 3.35%.

The People’s Bank of China also cut collateral requirements for its medium-term lending facility for banks, a move it said was aimed at easing pressure on the bond market.

The world’s second-largest economy has struggled to regain momentum since the COVID-19 pandemic, with the collapse of the housing market posing a major obstacle.

Economic growth fell to 4.7% in the last quarter, but remained within the government’s target of around 5% for the first half of the year.