SHANGHAISINGAPORE, Feb 19 Reuters China is widely expected to trim its benchmark mortgage reference rate at a monthly fixing on Tuesday, as banks39; improving net interest margins give authorities some leeway to use monetary stimulus to shore up faltering economy growth.

The loan prime rate LPR normally charged to banks39; best clients is calculated each month after 20 designated commercial banks submit proposed rates to the People39;s Bank of China PBOC.

In a survey of 27 market watchers conducted this week, 25, or 92.6, of all respondents expected a reduction to the fiveyear LPR on Tuesday. They projected a cut of five to 15 basis points.

Meanwhile, seven, or 25.9, of all the participants predicted a cut in the oneyear tenor .

Most new and outstanding loans in the world39;s secondlargest economy are based on the oneyear LPR, which stands at 3.45. It was lowered twice by a total of 20 basis points in 2023.

The fiveyear rate influences the pricing of mortgages and is 4.20 now. It was last trimmed in June 2023 by 10 basis points.

The strong expectation of a reduction to the mortgage reference rate comes after the central bankbacked Financial News reported on Sunday that the benchmark LPR could fall in coming days, with fiveyear tenor more likely to be reduced.

Lowering fiveyear LPR will help stabilise confidence, promote investment and consumption, and also help sup port the stable and healthy development of the real estate market, the newspaper said on its…