5-year lending rate down by biggest margin on record

China's over-five-year loan prime rate, a market-based benchmark lending rate also known as LPR, dropped to 4.45 percent in May, down from 4.6 percent in April, the National Interbank Funding Center said on Friday.

Meanwhile, the one-year LPR came in at 3.7 percent on Friday, staying unchanged for the fourth consecutive month, the center said.

Experts said the 15-basis point drop in the over-five-year LPR marked the biggest decline on record and the second decrease this year following one in January, indicating the country's increased strength of policy support to stabilize the economy.

Wen Bin, chief researcher at China Minsheng Bank, said the reduction in the over-five-year LPR, on which many lenders base their mortgage rates, will lessen the home purchase costs in the household sector, better meet their reasonable housing demand and boost their willingness to consume.

Also, the move will markedly help lower the medium to long-term financing costs of enterprises, restore their confidence in business prospects and bolster the country's expansion of longer-dated loans, he said.