Chinese Banks to Lower Interest Rates on Massive Deposits

Chinese banks are preparing to reduce interest rates on deposits worth 300 trillion yuan, following guidance from the central bank's self-disciplinary mechanism. One-year time deposits may see a reduction of 20 basis points, while longer-term deposits may decrease by 25 basis points.

Chinese banks are on the brink of a significant adjustment as they plan to slash interest rates on a staggering 300 trillion yuan ($42.3 trillion) in deposits by the end of this week, according to Bloomberg News.

This move, aimed at rejuvenating the financial landscape, will be guided by the central bank's interest rate self-disciplinary mechanism. Major banks are poised to lower rates on a variety of deposit products under this guidance.

Specifically, rates on one-year time deposits are expected to drop by at least 20 basis points. Meanwhile, longer-term tenors could see cuts of at least 25 basis points. The outcome of these adjustments could reshape saving trends significantly.

(With inputs from agencies.)