BEIJING (Reuters) -China’s major state banks will cut their deposit rates from Tuesday, three people with knowledge of the matter said, easing pressure on profitability as China reduces lending rates to boost a slowing economy.
Banks including Industrial and Commercial Bank of China, China Construction Bank (OTC:CICHF) and Bank of China will cut rates on some fixed-term deposits, said the sources, who declined to be named as they are not authorised to speak to media.
The sources did not detail the scale of the rate cuts.
The banks did not immediately reply to requests for comment.
Chinese authorities announced a raft of stimulus measures earlier this month, including interest rate cuts and a major liquidity injection, as Beijing steps up efforts to soften the economic fallout from the trade war with the United States.
People’s Bank of China (PBOC) Governor Pan Gongsheng said a 10 basis point cut to the country’s main seven-day reverse repo rate would lead to a reduction in the benchmark loan prime rate (LPR) of the same size.
China is due to release its monthly LPR fixing at 0100 GMT.
Reducing deposit rates would help banks lower their funding costs at a time when they are under pressure to support economic growth amid a property crisis, weak loan demand and record low interest margins.