What is a Default Rate?

The benchmark interest rate is an interest rate that has universal reference in the financial market. Other interest rates or the price of financial assets can be determined based on this benchmark interest rate. The benchmark interest rate is one of the important prerequisites for the marketization of interest rates. Under the marketization of interest rates, financiers measure financing costs, investors calculate investment income, and management's macroeconomic regulation and control all objectively require a generally recognized benchmark. The interest rate level is used as a reference. Therefore, in a sense, the benchmark interest rate is the core of the interest rate marketization mechanism.

Benchmark interest rate

The benchmark interest rate is

The benchmark interest rate must have the following basic characteristics:

(1) Marketization. It is obvious that the benchmark interest rate must be determined by

China benchmark interest rate

The benchmark interest rate is

Base Rate China Current Affairs

From September 16, 2008, the central bank decided to lower the benchmark loan interest rate and the reserve requirement ratio. Implement differential treatment, have

Benchmark interest rate

Maintaining the principle of pressure and structural optimization, the one-year RMB loan benchmark interest rate was reduced by 0.27 percentage points. The benchmark loan interest rates for other maturities and grades were adjusted accordingly in accordance with the principle of short-term multi-adjustment and long-term less-adjustment;

From September 25, 2008, except for the Industrial and Commercial Bank of China, Agricultural Bank of China, Bank of China, Construction Bank, Bank of Communications, and Postal Savings Bank, the RMB deposit reserve ratio of other depository financial institutions has been reduced by 1 percentage point. The Wenchuan earthquake The deposit reserve ratio of corporate financial institutions in hardest hit areas has been reduced by 2 percentage points. The central bank raised the benchmark interest rate = interest rate hike is the abbreviation of the interest rate, which refers to the ratio of the amount of interest to the amount of deposits or loans in a certain period of time, which is determined by the supply and demand relationship of funds.

Base rate increase

The People's Bank of China announced on the evening of February 8, 2011 that the benchmark interest rate for one-year deposits and loans of financial institutions will be increased by 0.25% from the 9th, and the benchmark interest rates for other grades of deposits and loans will be adjusted accordingly.

Benchmark interest rate

The central bank announced that it would raise the benchmark interest rate for deposits and loans by 0.25 percentage points from April 6. The benchmark interest rate for one-year deposits was 3.25 and the benchmark interest rate for one-year loans was 6.31. For details, please refer to the website of the People's Bank of China.

Base rate increase

Benchmark interest rate adjustment table for financial institutions' RMB loans

The People's Bank of China announced on the evening of July 6, 2011 that the benchmark interest rate for RMB deposits and loans of financial institutions will be increased from July 7, 2011. The one-year deposit and loan benchmark interest rates of financial institutions were raised by 0.25 percentage points, and other grades of deposit and loan benchmark interest rates and personal housing provident fund loan rates were adjusted accordingly.

This is the third rate hike by the central bank since 2011 and the fifth rate hike since the financial crisis. After adjustment, the one-year RMB deposit rate of financial institutions reached 3.5%, and the one-year loan interest rate reached 6.56%.

Benchmark interest rate

Financial market

There are three types of interest rates in China:

First, the People's Bank of China's deposit and loan interest rates for commercial banks and other financial institutions, that is, the benchmark interest rate,

Aka legal interest rate;

Second, the interest rates of deposits and loans of commercial banks to enterprises and individuals are called commercial bank interest rates;

Third, interest rates in financial markets are called market rates. Among them, the benchmark interest rate is the core. It plays a key role in the entire financial market and the interest rate system. ^[2]

Previous interest rate adjustment table

Unit: Annual interest rate%

Adjust the time	current	3 months	Half a year	One year	Two years	Three years	Five years
April 15, 1990	2.88	6.30	7.74	10.08	10.98	11.88	13.68
August 21, 1990	2.16	4.32	6.48	8.64	9.36	10.08	11.52
April 21, 1991	1.80	3.24	5.40	7.56	7.92	8.28	9.00
May 15, 1993	2.16	4.86	7.20	9.18	9.90	10.80	12.06
July 11, 1993	3.15	6.66	9.00	10.98	11.70	12.24	13.86
May 1, 1996	2.97	4.86	7.20	9.18	9.90	10.80	12.06
August 23, 1996	1.98	3.33	5.40	7.47	7.92	8.28	9.00
October 23, 1997	1.71	2.88	4.14	5.67	5.94	6.21	6.66
March 25, 1998	1.71	2.88	4.14	5.22	5.58	6.21	6.66
July 1, 1998	1.44	2.79	3.96	4.77	4.86	4.95	5.22
December 7, 1998	1.44	2.79	3.33	3.78	3.96	4.14	4.50
June 10, 1999	0.99	1.98	2.16	2.25	2.43	2.70	2.88
February 21, 2002	0.72	1.71	1.89	1.98	2.25	2.52	2.79
October 29, 2004	0.72	1.71	2.07	2.25	2.70	3.24	3.60
August 19, 2006	0.72	1.80	2.25	2.52	3.06	3.69	4.14
March 18, 2007	0.72	1.98	2.43	2.79	3.33	3.96	4.41
May 19, 2007	0.72	2.07	2.61	3.06	3.69	4.41	4.95
July 21, 2007	0.81	2.34	2.88	3.33	3.96	4.68	5.22
August 22, 2007	0.81	2.61	3.15	3.60	4.23	4.95	5.49
September 15, 2007	0.81	2.88	3.42	3.87	4.50	5.22	5.76
December 21, 2007	0.72	3.33	3.78	4.14	4.68	5.40	5.85
October 9, 2008	0.72	3.15	3.51	3.87	4.41	5.13	5.58
October 30, 2008	0.72	2.88	3.24	3.60	4.41	4.77	5.13
November 27, 2008	0.36	1.98	2.25	2.52	3.06	3.60	3.87
December 23, 2008	0.36	1.71	1.98	2.25	2.79	3.33	3.60
October 20, 2010	0.36	1.91	2.20	2.50	3.25	3.85	4.20
December 25, 2010	0.36	2.25	2.5	2.75	3.55	4.15	4.55
February 9, 2011	0.40	2.60	2.80	3.00	3.90	4.50	5.00
April 6, 2011	0.50	2.85	3.05	3.25	4.15	4.75	5.25
July 7, 2011	0.50	3.10	3.30	3.50	4.40	5.00	5.50
June 8, 2012	0.40	2.85	3.05	3.25	4.10	4.65	5.10
July 6, 2012	0.35	2.60	2.80	3.00	3.75	4.25	4.75
November 22, 2014 [3]	0.35	2.35	2.55	2.75	3.35	4.00	4.9