China cuts key interest rate amid economic slowdown

Central bank reduces one-year loan prime rate but surprises analysts by leaving five-year rate unchanged

China’s central bank has cut one of its key lending rates but left another unchanged, surprising economists who had expected more forceful action to support economic growth amid widespread concerns over its path.

The world’s second-largest economy is in the midst of a slowdown, and has slipped into deflation with prices falling year on year as slowing domestic spending weighs on the country’s post-Covid economic recovery.

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