China keeps benchmark lending rates at record lows

(Sharecast News) - China left its benchmark lending rates at record lows on Monday, as policymakers maintained a cautious stance amid Middle East tensions and mixed domestic economic data. The People's Bank of China held the one-year loan prime rate at 3.0% and the five-year rate, a reference for mortgages, at 3.5% for a 13th consecutive month.

The decision came as retail sales unexpectedly fell in May, housing prices continued to decline and yuan loan growth remained slower than a year earlier, although industrial output growth accelerated.

Chinese markets were mixed after the decision but later finished in the green, with the Shanghai Composite closing up 1.78% and the Shenzhen Component ahead 2.13%.

China's 10-year government bond yield fell to around 1.73%, while investors increasingly expect Beijing to favour targeted stimulus over broad-based monetary easing.

Reporting by Josh White for Sharecast.com.