BEIJING, Feb. 20 -- China's loan prime rate (LPR), a market-based benchmark lending rate, saw its over-five-year rate, on which lenders base their mortgage rates, come in at 3.95 percent on Tuesday, down from the previous reading of 4.2 percent.

The one-year LPR remained unchanged at 3.45 percent, according to the National Interbank Funding Center.

The reduction in the over-five-year rate was within expectation, but the extent exceeded market expectation, analysts said, noting that the 25-basis-point drop marks the largest in recent years.

A lower LPR is expected to shore up the credit and property markets, reduce the financial costs of businesses and individuals, and contribute to steady economic recovery at the beginning of 2024.

The previous LPR decline occurred last August when the one-year rate slipped from 3.55 percent to 3.45 percent, while the over-five-year rate was flat at 4.2 percent.