On November 20th, the People's Bank of China authorized the National Interbank Funding Center to announce the latest loan market quoted interest rates (LPR): the 1-year LPR is 3.0%, and the 5-year and above LPR is 3.5%. This is the LPR quotation for two term varieties, which has remained unchanged for six consecutive months after both were lowered by 10 basis points on May 20th, and the market generally believes it meets expectations. Since June, the LPR quotation has remained unchanged, driven by factors such as higher than expected exports since the beginning of the year and rapid development in the domestic new quality productivity sector. The macroeconomic trend is stable but relatively strong, and the demand for countercyclical adjustment has correspondingly decreased. Monetary policy maintains strong determination. ”Wang Qing, Chief Macro Analyst of Dongfang Jincheng, analyzed that since the announcement of the LPR quotation on October 20th, the 7-day reverse repo rate of the central bank has remained stable, which means that the pricing basis of the November LPR quotation has not changed and largely indicates that the LPR quotation for the month will remain unchanged. Industry insiders believe that although major mid to long term market interest rates, including the yield to maturity of 1-year interbank certificates of deposit (AAA rating), have remained stable and slightly decreased recently, and the financing costs of commercial banks in the money market have slightly decreased, the current quoting banks lack the motivation to actively lower their LPR quotation points in the context of the lowest historical net interest margin of commercial banks. The data recently released by the State Administration of Financial Supervision and Administration shows that the net interest margin of commercial banks in the third quarter of this year was 1.42%, which is the same as the second quarter and still at a historical low. Since the reform and improvement of the LPR pricing mechanism by the People's Bank of China in August 2019, LPR has now become a reference benchmark for financial institution loan interest rate pricing, directly affecting the cost of enterprise financing and resident credit. Since the beginning of this year, the People's Bank of China has deepened the market-oriented reform of interest rates, continuously released the effectiveness of LPR reform, and promoted a steady decline in loan interest rates. The latest data shows that current loan interest rates remain at a low level, with a weighted average interest rate of 3.1% for new loans (in domestic and foreign currencies) issued by enterprises in October, which is about 40 basis points lower than the same period last year; The weighted average interest rate for newly issued personal housing loans (in domestic and foreign currencies) is 3.1%, which is about 8 basis points lower than the same period last year. For the main ideas of the next stage of monetary policy, the recently released "Report on the Implementation of China's Monetary Policy in the Third Quarter of 2025" clearly states that the People's Bank of China will implement a moderately loose monetary policy and maintain relatively loose social financing conditions. According to the changes in the economic and financial situation, we should do a good job in countercyclical and cross cyclical adjustment, and continuously create a suitable monetary and financial environment. Closely monitor changes in monetary policies of major central banks overseas, and continuously strengthen analysis and monitoring of liquidity supply and demand in the banking system and changes in financial markets. Comprehensively utilize various monetary policy tools to maintain sufficient liquidity. In addition, the People's Bank of China will further promote the market-oriented reform of interest rates and smooth the transmission channels of monetary policy. Continuously reforming and improving LPR, focusing on improving the quality of LPR quotations, more accurately reflecting the level of interest rates in the loan market, urging financial institutions to adhere to risk pricing principles, clarify the relationship between loan interest rates and market interest rates such as bond yields, continue to deepen the pilot work of clearly indicating the comprehensive financing cost of enterprise loans, and promote the downward trend of social comprehensive financing costs. Against the backdrop of increased external instability and uncertainty, and the need to strengthen the foundation for domestic economic recovery, the tone of monetary policy has become more proactive, focusing on achieving the goal of 'stable growth' and enhancing liquidity support. ”Wen Bin, Chief Economist of China Minsheng Bank, stated that the central bank's emphasis on "cross cycle" adjustment means that monetary policy will balance short-term stable growth and medium - to long-term structural adjustment. While policy efforts are expected to support economic growth within the next year, the intensity is expected to be relatively cautious, focusing on structural optimization, guiding key areas to make efforts, and promoting the formation of more economic development models led by domestic demand, driven by consumption, and endogenous growth. Wang Qing believes that in order to stabilize the economic operation in the fourth quarter of this year and the first quarter of next year, the policy of stabilizing growth is expected to enter the stage of exerting force, and there is still sufficient space for monetary policy in the direction of moderate easing. Wen Bin stated that considering the need to further consolidate the foundation of the current economic recovery and the signal of "implementing more proactive macro policies" released by the "Proposal of the Central Committee of the Communist Party of China on Formulating the 15th Five Year Plan for National Economic and Social Development", there is still room for greater monetary policy easing. (New Society)