SHANGHAI: China's central bank extended loans from its medium-term lending facility on Tuesday but kept the one-year lending rate unchanged, as it seeks to maintain adequate liquidity in a slowing economy without flooding the banking system.
Still, many analysts expect China to step up stimulus this week by setting benchmark rates for new loans lower on Friday amid broad central bank easing globally. The U.S. Federal Reserve is widely expected to cut rates later this week, following renewed quantitative easing by the European Central Bank.
The People's Bank of China (PBOC) extended 200 billion yuan ($28.27 billion) of one-year medium-term lending facility (MLF) loans on Tuesday as a batch of such loans - worth 265 billion yuan - matures. Meanwhile, a batch of seven-day reverse repurchase agreements, worth 80 billion yuan, also matures on the day.
The PBOC kept the one-year MLF rate unchanged, at 3.3%, reflecting an inclination to avoid loosening monetary policies too much, despite China's growing economic pressures. - Reuters
