China’s central bank extends medium-term loans, keeps rates unchanged

Pedestrians walk past the People’s Bank of China headquarters in Beijing, China, on January 7, 2019.Giulia Marchi | Bloomberg | Getty ImagesChina’s central bank extended loans through its medium-term lending facility (MLF) on Wednesday while keeping the lending rate unchanged. The People’s Bank of China (PBOC) said on its website the interest rate on one-year MLF loans remained at 3.3%, the same as the previous operations. The PBOC also said it has injected 200 billion yuan ($28 billion) into financial institutions via the liquidity tool. The central bank usually conducts MLF operations when there is a maturity coming due, but there are no loans maturing on Wednesday. Some analysts believe that keeping the borrowing costs on medium-term loans unchanged reflects policymakers’ inclination to avoid loosening monetary policy too much lest it stokes a credit binge.

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