China’s 5 major state-owned banks lower deposit benchmark interest rates, with a 15 bps reduction in the 3-year term interest rate.
Major Chinese state-owned banks lowered the caps on US dollar deposit rates this week, a market-oriented move in response to ample dollar deposits at Chinese banks and an anticipated end to US interest rate hikes, experts said.
They refute claims by some foreign media that the Chinese government had intervened in the exchange rate.
A manager at a Bank of China branch in Shanghai said that the one-year dollar deposit rate dropped from 5 percent to 4.3 percent starting from Monday for deposits above $50,000 and 2.8 percent for those under $50,000.
"The fluctuation of bank interest rates is normal and relatively frequent," the manager told the Global Times.
She expected that the deposit rate would be kept steady for some time but will follow a downward trend in the longer term, attributing the rate cut to a number of market variables such as volatile global interest rates and rising dollar deposits at the banks.
A manager of an Industrial and Commercial Bank of China (ICBC) branch in downtown Beijing confirmed to the Global Times that dollar deposit rates had been cut significantly, amid expectations of no more US interest rate hikes in the coming months.
For a deposit of $30,000, the rate was 4.8 percent on Sunday but only 2.8 percent on Monday.
In addition to the dollar deposits, a number of Chinese lenders also moved to reduce rates on yuan deposits.