The G7 meting listed in the calendar is the meeting opg G7 finance minister and central bankers.
The People’s Bank of China will be setting their Loan Prime Rates (LPRs) today.
Current LPR levels are:
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One-year LPR: 3.10%
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Five-year LPR: 3.60%
These rates have remained unchanged since October 2024, when the PBOC implemented a 25 basis point reduction for both maturities. The one-year LPR primarily influences corporate and household loans, while the five-year LPR serves as a reference for mortgage rates.
LPRs are no longer as important as they once were. The People’s Bank of China (PBOC) shifted its primary monetary policy tool to the seven-day reverse repurchase agreement (reverse repo) rate. This transition began in mid-2024. This move aligns China’s monetary policy framework more closely with global standards, such as those of the U.S. Federal Reserve and the European Central Bank, which typically rely on a single short-term policy rate to guide market expectations and liquidity.
The 7-day reverse repo rate is a short-term interest rate used in the PBOC’s open market operations to manage liquidity in the banking system. By adjusting this rate, the PBOC influences short-term borrowing costs, which in turn affect broader financial conditions, including the Loan Prime Rate (LPR), a key reference for lending rates in China.
As of May 8, 2025, the PBOC reduced the 7-day reverse repo rate by 10 basis points to 1.40%, marking the first cut since September 2024. This reduction is part of a broader strategy to stimulate the economy amid challenges such as trade tensions and a slowing property market.
Of more focus is the Reserve Bank of Australia, widely expected to cut its cash rate by 25bp today, and further in the months ahead:
- 75bp of Reserve Bank of Australia rate cuts to come (Reuters poll)
- of the big 4 Australian banks ANZ, CBA and WPAC are tipping a 25bp cut, NAB a 50bp cut
- This snapshot from the ForexLive economic data calendar, access it here.
- The times in the left-most column are GMT.
- The numbers in the right-most column are the ‘prior’ (previous month/quarter as the case may be) result. The number in the column next to that, where there is a number, is the consensus median expected.
This article was written by Eamonn Sheridan at www.forexlive.com.
