The Central Bank of the People's Republic of China is responsible for formulating and implementing monetary policies, preventing and resolving financial risks, and maintaining financial stability.
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China kept key benchmark lending rates unchanged on Friday at a fixed monthly time.
Market watchers polled by Reuters expected Because the Federal Reserve cut interest rates by 50 basis points, it provides China with more room to reduce domestic borrowing costs without causing a sharp depreciation of the yuan.
The People's Bank of China (PBOC) said it will maintain the one-year loan prime rate (LPR) at 3.35% and the five-year loan prime rate (LPR) at 3.85%.
The one-year LPR applies to most new and outstanding loans in China, while the five-year loan rate affects mortgage pricing.
U.S. interest rate cuts provide China with greater monetary flexibility to focus on easing the debt burden on consumers and businesses as it seeks to stimulate investment and spending.
China surprised markets in July by cutting key short- and long-term lending rates in a move aimed at boosting its economic growth as the country faces a protracted housing crisis and weakening consumer and business confidence.
In August, China's retail sales, industrial production and urban investment growth rates were lower than expected and lower than the expectations of economists polled by Reuters. Urban unemployment rose to a six-month high and house prices fell at their fastest annual rate in nine years.
Disappointing economic data highlighted sluggish economic momentum and renewed calls for more fiscal and monetary stimulus.
Some major banks have lowered their full-year GDP growth forecasts for China to below the government's official target of 5%. Bank of America lowered China's 2024 GDP growth forecast to 4.8%, and Citigroup lowered its forecast to 4.7%.
Reuters contributed to this report.