BEIJING / RankWire.AI / – China kept its key lending rates unchanged in September, continuing a period of consistent borrowing rates. The one-year loan prime rate stayed at 3.0%, and the over-five-year rate remained at 3.5%. These longer-term benchmarks are frequently used by banks for mortgage pricing. The rates fixed in September are identical to those in August, preserving the same levels that are fundamental to loan pricing throughout China’s banking sector.
The People’s Bank of China manages the system used to set the loan prime rate. The monthly fixing is issued by the National Interbank Funding Center. The one-year LPR acts as a reference point for many business and household loans, while the over-five-year LPR influences mortgage rates and other long-term borrowings. The decision in September left these key lending benchmarks unchanged for both major maturity categories.
These stable LPR figures come amid recent data on inflation, credit, and the property sector. China’s consumer price index rose by 0.8% in August compared to the previous year. Prices increased by 0.4% from July, offering the latest insight into consumer inflation. The rate decision also comes on the heels of new housing and financing data covering the first eight months of 2026.
Mortgage benchmark remains at 3.5%
In August, housing market trends varied across China’s largest cities. First-tier cities saw new home prices rise by 0.1% compared to July. Shanghai experienced a 0.4% increase in prices for the month. Guangzhou’s prices grew by 0.1%, while Shenzhen saw a 0.2% rise. Conversely, Beijing’s prices fell by 0.2%. These figures highlight the uneven nature of price movements within China’s top property markets.
From January to August, property investment reached 4.798 trillion yuan, reflecting a 19.9% decrease compared to the same period last year. Residential investment declined by 19.7%, totaling 3.702 trillion yuan. Sales of newly constructed commercial properties amounted to 4.747 trillion yuan, dropping by 13.0%. The property market remains closely tied to the over-five-year LPR, as many mortgage terms are set using this rate.
Indicators for credit and property markets inform September rate decision
In the first eight months of 2026, commercial property sales of new builds totaled 498.8 million square meters, representing a 12.1% decline year-over-year. Residential sales area decreased by 13.0%, with the sales value dropping by 13.1%. Property developers’ individual mortgage loans reached 684.6 billion yuan, which is 22.4% lower than the previous year. These figures provide additional context for housing-related borrowing conditions.
At the end of August, China’s outstanding social financing was 464.8 trillion yuan, showing a 7.2% increase from a year earlier. Social financing in the real economy, via Renminbi loans, stood at 278.63 trillion yuan, up by 5.0%. Government bonds within total social financing reached 103.69 trillion yuan, a rise of 13.5%. Amid these developments, the People’s Bank of China maintained the one-year LPR at 3.0% and the over-five-year rate at 3.5%.