PBoC cuts rates for second time in a month

The People’s Bank of China (PBoC) cut interest rates Thursday – only a month after the most recent cut – in an effort to jump-start the country’s slowing economy, Reuters reported. The central bank lowered the benchmark one-year lending rate by 0.31 percentage points to 6% and the deposit rate by 0.25 points to 3%. The bank also adjusted the floor on lending rates to 70% of the benchmark, down from 80%. The rate cuts, which came much earlier than expected, may be a troubling harbinger of poor economic data to be released to the public next week, analysts said. The PBoC cut rates at the same time as the Bank of England and European Central Bank launched stimulus efforts, raising speculation that the banks coordinated. China’s GDP grew by 7.6% in the second quarter, the slowest rate since the US financial crisis.