Global Market Update: China Holds Rates, Europe Rises Despite UK Retail Slump

The global financial markets saw a mix of policy decisions and economic data releases today, which have collectively shaped investor sentiment across Asia and Europe.

Here’s a quick breakdown of the key highlights.

China Keeps Benchmark Lending Rates Unchanged

The People's Bank of China (PBoC) decided to maintain its benchmark lending rates today:

One-year Loan Prime Rate (LPR) remains at 3.00%
Five-year LPR — typically used to price mortgages — holds steady at 3.50%

This move was widely expected as the Chinese economy continues to show signs of recovery without necessitating immediate rate cuts. By keeping rates unchanged, the central bank signals a cautiously balanced approach between supporting growth and avoiding financial risks.

European Shares Gain Despite UK Retail Sales Drop

Meanwhile in Europe, stock markets opened higher, rebounding from recent losses — even after concerning economic data from the UK:

UK retail sales plunged by 2.7% in May 2025
This marks the sharpest monthly decline since December 2023

Interestingly, the broader European market advanced, as investors anticipated that weak consumption data might prompt the Bank of England (BoE) to stay cautious on future rate hikes, potentially supporting equities.

Conclusion

Today's market narrative was one of cautious optimism — China maintaining stability, Europe rebounding despite weak UK data, and traders continuing to navigate a landscape shaped by inflation worries and monetary policy balancing acts.

Stay tuned — the coming weeks promise more crucial economic updates and policy decisions.

This content is for educational and knowledge purposes only and should not be considered as investment or Trading advice. Please consult a certified financial advisor before making any investment or Trading decisions.

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Our Recent FAQS

Frequently Asked Question &
Answers Here

Q1️⃣: What did the People’s Bank of China decide today?

The PBoC kept its one-year loan prime rate at 3.00% and the five-year LPR at 3.50%, choosing not to adjust lending rates this month.

Q2️⃣: Why did China keep its rates unchanged? 📝 The Chinese economy is recovering steadily, and

The Chinese economy is recovering steadily, and the central bank appears to be balancing growth support while keeping an eye on financial stability and avoiding excess liquidity.

Q3️⃣: What happened with UK retail sales?

Retail sales in the UK fell sharply by 2.7% in May 2025, marking one of the largest monthly drops since December 2023 — a worrying sign for consumer demand.

Q4️⃣: How did European markets react?

Despite the weak UK retail data, European shares rose as investors bet that the Bank of England might hold off on rate hikes, which could be favorable for market sentiment in the short term.

Q5️⃣: What’s the outlook for global markets now?

Markets remain sensitive to inflation data, central bank decisions, and consumer demand indicators. With China holding rates and UK retail sales faltering, investor focus will shift to upcoming central bank meetings and economic forecasts next week.