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The PBoC is expected to keep the benchmark rates unchanged in 2021, according to Lee Sue Ann, Economist at UOB Group.

Key Quotes

“With the acceleration of economic recovery, the pressure to ease monetary policy further has been greatly reduced which will allow the PBoC to pay attention to financial risks mitigation ahead.”

“The rise in the Shibor rates also poses a challenge for banks to lower the LPR further. As such, we expect the PBoC to continue to hold rates into 2021.”