China cuts another key interest rate to boost economy

A man visits an Indian items shop at the Yiwu market in Yiwu, China's eastern Zhejiang province on September 21, 2024.
AFP/Adek Berry

BEIJING, China — China's central bank on Wednesday said it would slash another key interest rate, a day after it unveiled a raft of new measures aimed at boosting its ailing economy.

The medium-term lending facility -- the interest for one-year loans to financial institutions -- was cut from 2.3 percent to 2.0 percent, the People's Bank of China said in a statement on its website.

The rate was last lowered in July.

The world's second-largest economy has yet to achieve a highly anticipated post-pandemic recovery and the government has set a goal of five percent growth in 2024 -- an objective analysts say is optimistic given the headwinds it is facing.

On Tuesday, central bank chief Pan Gongsheng told a news conference in Beijing that the bank would introduce a series of measures to boost growth and pledged to "promote the expansion of consumption and investment".

Among those measures were a reduction in the amount of cash banks must hold in reserve and the lowering of interest rates for existing mortgages.

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