China left its benchmark lending rates unchanged Monday, as Beijing contends with a weakening yuan while awaiting policy clues from the incoming Donald Trump administration.

The People’s Bank of China held the 1-year loan prime rate at 3.1%, and the 5-year LPR at 3.6%, according to the PBOC statement.

The 1-year LPR determines rates on corporate and most household loans, while the 5-year LPR acts as a reference for mortgage loans.

The decision came ahead of Donald Trump’s inauguration to be the next president of the U.S. on Monday.

“The government is willing to delay interest rate cut and give exchange rate stability higher priority,” said Zhiwei Zhang, president and chief economist at Pinpoint Asset Management.

He added that “Beijing will likely evaluate the impact of the trade policies in the U.S. in coming weeks and decide how to respond after the Chinese New Year.”

Mainland China’s benchmark CSI 300 index jumped 1.08%, following the rate decision. The offshore yuan strengthened 0.20% to 7.3244 per U.S. dollar, while the onshore yuan traded at 7.3157 per dollar. China’s 10-year government bond yields held steady at 1.661%, according to the LSEG data.

“The seemingly good growth number” and a strong greenback prevented China from cutting rates on Monday, said Gary Ng, senior economist at Natixis. “While China needs lower interest rates to boost demand, policymakers want to avoid a sharp decline in bond yields and the yuan.”

Ng expects China to cut rates by 50 basis points this year, although the timing will depend on external monetary conditions, namely the U.S. Federal Reserve’s easing steps.

The PBOC has ramped up measures lately to forestall a sharp fall in the currency that could spark excessive volatility while stressing the importance of foreign exchange stability.

China’s offshore yuan has lost more than 3% since Donald Trump’s presidential election victory in early November. The tightly-controlled onshore yuan has also retreated to near a 16-month low.

The U.S. dollar index, which measures the greenback versus six other currencies, has climbed to near a 26-month highs.

China’s economic activity accelerated more than expected in the final quarter of last year, as Beijing’s stimulus measures announced since last September kicked in and helped the economy meet its annual growth target.

Despite the upbeat headline figures, economists cautioned that some underlying growth drivers might be temporary, amid weak consumer demand, a deepening property market slump and looming tariff hikes from the incoming Trump administration.

PBOC governor Pan Gongsheng had flagged in September the possibility of a cut in the reserve requirement ratio by the end of 2024, depending on market’s liquidity condition. The RRR determines the amount of cash that banks must hold in reserves.

But the cuts are yet to materialize, despite the PBOC’s shift to a “moderately loose” policy stance.

Any policy moves by the PBOC in the near term are likely to hinge on Trump’s trade policy announcements, Helen Qiao, chief Greater China economist and head of Asia economics at BofA Global Research said in a note last Thursday.

“Any potential surprise of immediate and sharp increase in tariffs would warrant more immediate policy responses,” she added.

The PBOC had surprised the markets by shaving short- and long-term lending rates in July, followed by a widely-anticipated 25-basis-point cut in October. The central bank had kept the lending rates unchanged in November and December.

Markets have pared expectations for the number of rate cuts by the U.S. Federal Reserves this year, mostly pricing in just one quarter-percentage cut in 2025, according to CME FedWatch tool as of Monday.