BEIJING / RankWire.AI / – China maintained its benchmark lending rates at the same levels in September, continuing a period of stable borrowing costs. The one-year loan prime rate (LPR) stayed at 3.0%, while the over-five-year rate remained at 3.5%. This longer-term benchmark is typically used by banks for mortgage pricing. The September fixing kept both rates at the same levels observed in August, remaining central to loan pricing throughout China’s banking sector.
The People’s Bank of China manages the framework that sets the loan prime rate, with the monthly fixing published by the National Interbank Funding Center. The one-year LPR serves as a benchmark for numerous business and household loans. The over-five-year LPR plays a direct role in mortgage costs and other long-term borrowings. The decision in September left these lending benchmarks unchanged for both key maturities.
Alongside the unchanged LPRs, recent data on inflation, credit, and the property market have been released. China’s consumer price index increased by 0.8% in August compared to the previous year, with a 0.4% rise from July. These figures provide the latest insight into consumer inflation. The rate decision also considers new housing and financing statistics covering activity through the first eight months of 2026.
Mortgage Rate Maintains at 3.5%
In August, housing data revealed varied trends across China’s major cities. Prices for new homes in first-tier cities increased by 0.1% from July. Shanghai recorded a 0.4% rise, Guangzhou saw a 0.1% increase, and Shenzhen’s prices went up by 0.2%. Conversely, Beijing experienced a 0.2% decline in home prices during the same period. These figures highlight the uneven movements in property prices across China’s leading markets.
Between January and August, property investment reached 4.798 trillion yuan, marking a 19.9% decrease compared to the same period last year. Residential investments dropped 19.7% to 3.702 trillion yuan. Sales of new commercial properties totaled 4.747 trillion yuan, down 13.0%. The property sector remains closely tied to the over-five-year LPR, which lenders use to set many mortgage terms.
Indicators in Credit and Property Markets Inform September Rate Hold
Sales of new commercial properties covered 498.8 million square meters in the first eight months of 2026, reflecting a 12.1% decline year-over-year. Residential sales area also fell by 13.0%, with residential sales value dropping by 13.1%. Property developers obtained 684.6 billion yuan in individual mortgage loans, a decrease of 22.4% from the previous year. These figures offer additional context for the borrowing environment in the housing sector.
By the end of August, China’s outstanding social financing stood at 464.8 trillion yuan, an increase of 7.2% from a year earlier. Loans in renminbi to the real economy amounted to 278.63 trillion yuan, up 5.0%. Government bonds within the total social financing reached 103.69 trillion yuan, a rise of 13.5%. Given this background, the People’s Bank of China chose to keep the one-year LPR at 3.0% and the over-five-year rate at 3.5%.