China’s central bank kept its key interest rate steady on Monday as it continued to pump more money into the financial system, defying expectations that it would lower borrowing costs to support the economy.
The People’s Bank of China kept the interest rate on its one-year policy loans – called the medium-term lending facility – at 2.5%, contrary to widespread expectations among economists that it would make its first rate cut since August. It also provided 995 billion yuan ($139 billion) through the Multilateral Fund, resulting in a net injection of 216 billion yuan that will enhance liquidity and help meet demand for financing.