China cuts benchmark interest rates by 25 basis points

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China's central bank said on Saturday it would cut benchmark interest rates by 25 basis points to 5.35 percent, a widely expected move as the world's second-largest economy continues to show signs of weakness despite previous easing measures.

The central bank said it would also cut the benchmark saving rate by 25 basis points to 2.5 percent.

The cuts will come into effect on Sunday, according to the statement.

"The focus of the interest rate cut is to keep real interest rate levels suitable for fundamental trends in economic growth, prices and employment," the People's Bank of China (PBOC) said in a separate statement on its website.

"This does not represent a change in the direction of monetary policy."

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The move came about 15 hours before China was due to release official factory and services Purchasing Managers' Index surveys for February, the last data before the National People's Congress, the rubber-stamp legislature, convenes next week.

In its last round of rate cuts in November, the PBOC reduced one-year benchmark lending rates by 40 basis points to 5.6 percent and lowered one-year benchmark deposit rates by 25 basis points to 2.75 percent.

Beijing has been trying to lower borrowing costs and stimulate investment to reinvigorate an economy that expanded at its slowest rate for 24 years in 2014.

But the surprise interest rate cut in November, followed up by a February reduction in banks' reserve requirement ratios (RRR) that poured fresh cash into the financial system, had shown little effect on confidence.

That led most economists to predict the central bank would follow up with further cuts to guidance lending rates and the RRR this year.