Economics
China Cuts Bank Funding Costs in Step Toward Rate Corridor
- PBOC lowers Standing Lending Facility for smaller banks
- Policy makers continue evolution of monetary framework
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China’s central bank said it will lower short-term borrowing costs for smaller banks, the latest in a series of steps aimed at preventing sharp fluctuations on the money market when liquidity runs short.
The People’s Bank of China cut its seven-day Standing Lending Facility interest rate to 3.25 percent for local financial institutions, according to a statement posted Thursday on the central bank’s social media account. The overnight SLF rate was reduced to 2.75 percent for some local financial institutions.