China News Service, Beijing, January 22 (Reporter Pang Wuji) On the 22nd, the People's Bank of China authorized the National Interbank Funding Center to announce the latest loan market quoted interest rate (LPR): 1-year LPR is 3.45%, and 5-year and above LPR is 3.45%. LPR was 4.2%, both unchanged from the previous month.

Since September 2023, LPR has been "on hold" for five consecutive months.

　　It is worth noting that the latest LPR release coincides with the increase in the number of LPR quotation banks from 18 to 20.

According to recent news from the People's Bank of China, the People's Bank of China guided the interest rate self-discipline mechanism to conduct an assessment of LPR quoting banks on and off the market, and adjusted the LPR quoting banks based on the assessment results. After the adjustment, China CITIC Bank and Bank of Jiangsu were added.

The adjustment will be implemented from January 22.

　　Talking about the reason why the LPR was not adjusted this time, Wen Bin, chief economist of China Minsheng Bank, pointed out that the medium-term lending facility (MLF) interest rate remained unchanged in January and the pricing basis of the LPR quotation has not changed.

In addition, bank interest margins faced greater pressure at the beginning of the year, and there was insufficient space and motivation to proactively lower the LPR.

　　Wen Bin believes that the necessity and urgency of lowering the current policy interest rate is not high, but judging from the central bank’s stance, policy environment and actual demand, there may still be the possibility of interest rate cuts in the follow-up (March-April), and is expected to guide the LPR to moderate The downward trend will further promote the steady decline of financing costs, further stimulate the demand for credit for production and consumption, and stabilize economic operation.

　　The fact that LPR has not been adjusted does not mean that the mortgage interest rate has not changed.

Since 2021, China’s housing mortgage loan interest rates have been on a downward trend.

Monitoring by the Shell Research Institute shows that in January 2024, the average mainstream mortgage interest rate for first homes in 100 cities was 3.84%, 2 basis points lower than the previous month; the average mainstream mortgage interest rate for second homes was 4.41%, the same as last month.

In January, mainstream mortgage interest rates for first- and second-home buyers fell by 26 and 50 basis points respectively compared with the same period in 2023.

　　Li Yujia, chief researcher of the Housing Policy Research Center of the Guangdong Provincial Institute of Urban Planning, believes that while the supply and demand ends of real estate are still weak, it is expected that there is still room and necessity for LPR to be lowered in 2024.

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