(Yicai) Jan. 15 -- The People's Bank of China kept a key policy interest rate unchanged today, contrary to market expectations.

The central bank retained the 2.5 percent rate on CNY995 billion (USD139.4 billion) of one-year medium-term lending facility loans, adding a net CNY216 billion (USD30.3 billion) into the banking system, with CNY779 billion set to come due this month.

The PBOC has used the MLF to add liquidity for 13 straight months, bringing the net total to CNY2.7 trillion (USD378.5 billion) over the period.

The bank likely held off cutting the rate because policymakers are still waiting to see the effects of policy tools introduced previously to boost the economy, according to Golden Credit Rating International. They include the CNY350 billion of pledged supplementary lending added last month and the CNY1 trillion of national debt issued in the fourth quarter of last year.

Market interest rates are in a reasonable range, said Zhou Maohua, a financial markets analyst at Everbright Bank, as recent economic indicators reflect the ongoing recovery in the Chinese economy, with stable data in December and a moderate increase in lending last year.

The net injection of funds through the MLF is intended to guide financial institutions to go on increasing support to the real economy, Zhou added.

The PBOC has maintained the key policy rate for five months, after lowering it by 15 basis points in August. Against this backdrop, there is a high possibility that the bank will cut it this quarter to send a policy signal to steady growth and boost market confidence, according to Golden Credit.

China's new yuan-denominated loans totaled CNY1.17 trillion last month, down CNY240.1 billion from a year earlier, PBOC data showed on Jan. 12. New yuan lending rose CNY1.31 trillion to CNY22.75 trillion (USD3.2 trillion) in 2023, while new social financing jumped CNY3.41 trillion to CNY35.59 trillion.

The PBOC today also conducted a CNY89 billion (USD12.5 billion) seven-day reverse repurchase at a rate of 1.8 percent to offset CNY50 billion of maturing reverse repos with the same rate.

Editors: Dou Shicong, Martin Kadiev