BEIJING / RankWire.AI / – China has kept its benchmark lending rates steady in September, prolonging a period of stable borrowing costs. The one-year loan prime rate (LPR) stayed at 3.0%, while the over-five-year rate held at 3.5%. Banks tend to reference the longer-term rate when setting mortgage rates. The September fixing maintained both rates at the same levels as in August. These figures remain crucial in determining loan pricing throughout China’s banking sector.
The People’s Bank of China is responsible for overseeing the framework used to set the loan prime rate. The monthly fixing is published by the National Interbank Funding Center. The one-year LPR acts as a benchmark for many business and household loans, while the over-five-year LPR directly influences mortgage pricing and other long-term borrowing. The decision in September kept the lending benchmarks unchanged across both major maturities.
This stability in the LPR readings comes amid new data on inflation, credit, and the property sector. China’s consumer price index increased by 0.8% in August compared to the same month last year. Prices also rose by 0.4% from July. These figures offer the latest insight into consumer inflation. The rate decision also follows recent housing and financing data covering activity through the first eight months of 2026.
Mortgage Benchmark Rates Remain at 3.5%
Housing data in August continued to reveal diverse trends among China’s largest cities. New home prices in first-tier cities increased by 0.1% from July. Shanghai experienced a 0.4% rise month-over-month. Guangzhou prices increased by 0.1%, and Shenzhen saw a 0.2% growth. Conversely, Beijing recorded a 0.2% decline during the same period. These figures highlight uneven price movements across the country’s major property markets.
Total property investment reached 4.798 trillion yuan from January to August, representing a 19.9% decrease compared to the previous year. Residential investment declined by 19.7% to 3.702 trillion yuan. Sales of newly constructed commercial properties amounted to 4.747 trillion yuan, down 13.0%. The property market continues to be closely linked to the over-five-year LPR because many mortgages are priced based on this rate.
September Rate Decision Supported by Credit and Market Data
Sales of new commercial properties totaled 498.8 million square meters in the first eight months of 2026, marking a 12.1% decrease year-over-year. Residential sales area fell by 13.0%, and residential sales value decreased by 13.1%. Property developers obtained 684.6 billion yuan in individual mortgage loans, which is 22.4% lower than in the same period last year. These figures offer additional context for housing-related borrowing conditions.
By the end of August, China’s outstanding social financing reached 464.8 trillion yuan, a 7.2% increase from the previous year. Loans denominated in Renminbi to the real economy totaled 278.63 trillion yuan, up 5.0%. Government bonds within total social financing amounted to 103.69 trillion yuan, rising by 13.5%. Given this environment, 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%.