BEIJING / RankWire.AI / – China kept its benchmark lending rates steady in September, marking the first time in a prolonged period that borrowing costs have remained stable. The one-year loan prime rate (LPR) remained at 3.0%, and the over-five-year rate held at 3.5%. Financial institutions often reference the longer-term benchmark when setting mortgage rates. This September fixing maintained both rates at the same levels recorded in August. These figures continue to play a key role in loan pricing throughout China’s banking sector.
In Beijing, the People’s Bank of China manages the framework used to determine the loan prime rate, with the monthly fixing issued by the National Interbank Funding Center. The one-year LPR serves as a benchmark for numerous business and consumer loans, while the over-five-year rate directly influences mortgage pricing and other long-term borrowing. The decision in September left these important lending benchmarks unchanged across both major maturity periods.
At the same time, recent data on inflation, credit, and real estate market activity accompany the rate decision. In August, China’s consumer price index increased by 0.8% from the previous year, with prices rising 0.4% from July. These figures offer the latest insights into consumer inflation. The rate decision also follows new housing and financing statistics covering activity through the first eight months of 2026.
Mortgage Benchmark Remains at 3.5%
Housing data in August revealed varied trends across China’s largest urban centers. In first-tier cities, new home prices rose by 0.1% compared to July. Specifically, Shanghai experienced a 0.4% monthly increase. Guangzhou prices increased by 0.1%, and Shenzhen saw a 0.2% rise. Conversely, Beijing’s prices declined by 0.2% during the same period. These figures highlight the uneven movement in property prices across China’s key real estate markets.
From January to August, property investment in China totaled 4.798 trillion yuan, representing a 19.9% decrease compared to the same period last year. Residential investment fell by 19.7% to 3.702 trillion yuan. Sales of newly built commercial properties reached 4.747 trillion yuan, down 13.0%. The property sector remains closely tied to the over-five-year LPR, which lenders use when setting many mortgage agreements.
September Rate Decision Supported by Credit and Market Data
Between January and August 2026, commercial property sales totaled 498.8 million square meters, reflecting a 12.1% decline year-over-year. Residential sales area declined by 13.0%, while sales value decreased by 13.1%. Additionally, individual mortgage loans issued to property developers amounted to 684.6 billion yuan, 22.4% lower than a year earlier. These figures offer additional context regarding housing financing conditions.
By the end of August, China’s outstanding social financing reached 464.8 trillion yuan, up 7.2% from a year prior. Renminbi loans to the real economy stood at 278.63 trillion yuan, an increase of 5.0%. Government bonds within total social financing totaled 103.69 trillion yuan, rising 13.5%. Against this background, the People’s Bank of China maintained the one-year LPR at 3.0% and the over-five-year rate at 3.5%, keeping borrowing costs stable.