March 14 Reuters China39;s central bank is expected to leave a key policy rate unchanged when it rolls over maturing mediumterm loans on Friday, a Reuters survey showed, amid uncertainty over the timing of expected Federal Reserve interest rate cuts.

Market watchers widely believe Beijing will continue to prioritise the stability of the yuan, despite widespread views that the struggling economy needs more stimulus.

Cutting rates before a move by the Fed or other major central banks would widen yield differentials, potentially putting more pressure on the currency, which has depreciated 1.3 against the dollar so far this year despite persistent central bank efforts to shore it up.

In a Reuters poll of 36 market watchers conducted this week, 32, or 89, of respondents expected the People39;s Bank of China PBOC to keep the interest rate on oneyear mediumterm lending facility MLF loans unchanged at 2.50 when rolling over 481 billion yuan 66.86 billion worth of such loans.

The remaining four participants projected a marginal interest rate reduction.

We maintain our view that the PBOC will not frontrun the Federal Reserve for a policy rate cut, said Samuel Tse, economist at DBS.

After all, the authority aims at stabilising the exchange rate to forestall further capital outflows. Stabilising economic data also leaves room for a delayed rate cut decision.

The Fed is widely expected to cut interest rates this year if inflation cools, and markets now see a 65 chance of a…