China’s central bank cuts reverse repo rate to 2.5%

China’s central bank on Monday lowered the interest rate on its regular reverse repurchase open market operations for the first time since October 2015, aiming to boost market confidence and prop up slowing growth.

The People’s Bank of China said on its website that it cut the seven-day reverse repurchase rate to 2.5% from 2.55%.

The central bank also injected a net 180 billion yuan ($25.68 billion) of cash into the monetary system via open market operations.

China’s October economic and financial data fell across the board, while food prices continued to rise even as core inflation remained weak. Analysts said that with the downward pressure on the economy, the need to cut interest rates is rising.

The PBOC unexpectedly cut the interest rate on the one-year medium-term lending facility by 5 basis points to 3.25% earlier in November.

The central bank said in its quarterly monetary policy issued Nov. 16 that to prevent “a divergence of inflation expectations,” it may slightly adjust monetary policy based on changes in economic growth and price levels.