Another surprise interest rate cut from China

The People's Bank of China has made a surprise cut to its medium-term lending facility (MLF) rate. For the second time this week, the People's Bank of China has surprised markets by unexpectedly cutting the interest rate on its medium-term loans to banks, suggesting that authorities are trying to provide heavier monetary stimulus to support the economy. The People's Bank of China (PBOC) issued a one-year loan of 200 billion yuan ($27.5 billion) under the MLF at an interest rate of 2.30 percent, down 20 basis points from the previous MLF facility, the bank said in a statement. The medium-term lending facility (MLF) operation comes after it cut several benchmark lending rates on Monday. The PBOC also conducted a seven-day reverse repo of 235.1 billion yuan at an interest rate of 1.7 percent.