China increases property funding with a reduction in key loan rate since June.

• The Chinese central bank maintained the 3.45% rate for its one-year loan prime rate, which serves as the benchmark for most household and corporate loans in China.
• The People's Bank of China announced a 25 basis point cut in the benchmark five-year loan rate, bringing it to 3.95%, on Tuesday.

Beijing's efforts to stimulate its sluggish property market were bolstered by China's lenders, who reduced the country's benchmark five-year loan prime rate for the first time since June.

The People's Bank of China announced that it kept the one-year loan prime rate at 3.45% and cut the benchmark five-year loan rate by 25 basis points to 3.95%, effective immediately.

The five-year rate in the monthly fix for February was larger than anticipated, with expectations for a reduction of between five to 15 basis points in a Reuters poll of economists. This was also the largest one-time cut in the five-year rate and the first since the five-year rate was last trimmed in June by 10 basis points.

Beijing policymakers are concerned that the incremental slow-drip of policy easing implemented so far has had little impact, as indicated by the size of today's move, according to Louise Loo, lead economist at Oxford Economics.

Loo stated that although China's property issue is not directly linked to mortgages, the current action may increase demand slightly. However, it must be viewed in conjunction with a broader range of measures to manage an imminent property correction process.

The PBOC maintains its medium-term policy rate unchanged for February, while commercial lenders submit their proposed loan prime rates to China each month.

China reduced reserve ratio requirements for banks by 50 basis points from February 5th, providing 1 trillion yuan ($139.8 billion) in long-term capital, and encouraged banks to support loans for high-quality real estate developers.

Beijing's crackdown on developers' debt-driven growth in 2020 led to a slump in the property market, resulting in bankruptcy for some of China's largest real estate developers and negatively impacting consumer growth and broader economic growth in the world's second-largest economy.

— CNBC’s Lee Ying Shan contributed to this story.