BEIJING - China's one-year loan prime rate (LPR), a market-based benchmark lending rate, came in at 3.85 percent on Monday, unchanged from the previous month.

The over-five-year LPR, on which many lenders base their mortgage rates, also remained unchanged from the previous reading of 4.65 percent, according to the National Interbank Funding Center (NIFC).

The lending rates have remained steady for five consecutive months, matching market expectations, amid the government's efforts to maintain stable expectations and support recovery in the real economy sectors, said Wen Bin, chief analyst at China Minsheng Bank.

Wen expects the country's monetary policy to be more targeted, with the central bank focusing on open market operations and adjusting the medium-term lending facility (MLF) to ensure liquidity in the banking system.

However, Wen did not rule out the possibility of targeted cuts in the reserve requirement ratio in the last quarter of the year, which he said are necessary at an appropriate time.

Based on bank-calculated quotes made by adding a few basis points to the interest rate of open market operations (mainly referring to the MLF rate), the LPR is calculated by the NIFC to serve as the pricing reference for bank lending. Currently, the LPR consists of rates with two maturities -- one year and over five years.

The quoting banks submit their figures before 9 am on the 20th day of every month. The NIFC calculates and releases the LPR at 9:30 am on the same day, or the next working day.

China has vowed to pursue a prudent monetary policy in a more flexible and appropriate way. The central bank said in its second-quarter monetary policy report that it will make monetary policy more flexible and targeted to achieve a long-term balance between stabilizing growth and preventing risks.