China unexpectedly leaves benchmark lending rates unchanged after Feds jumbo cut [Video]

China on Friday kept its main benchmark lending rates unchanged at the monthly fixing.

Market watchers polled by Reuters had expected a trim as the Federal Reserve’s 50 basis point rate cut had given more room for China to lower its domestic borrowing costs without prompting a sharp decline in yuan. 

The People’s Bank of China (PBOC) said it would keep the one-year loan prime rate (LPR) at 3.35%, as well as the five-year LPR at 3.85%. 

The one-year LPR affects corporate and most household loans in China, while the five-year LPR acts as a benchmark for mortgage rates.

The rate cut stateside had allowed more monetary flexibility for China to focus on easing the debt burden on its consumers and businesses as it seeks to bolster investment and spending. 

China surprised the markets by shaving major short and long term lending rates in July, in a move to reflate growth in its economy, which was facing a prolonged property crisis …