China cut benchmark lending rates for the first time since October on Tuesday, while major state banks cut deposit rates.

The widely-expected rate cuts are aimed at stimulating consumption and loan growth.

The People's Bank of China said the one-year loan prime rate (LPR), a benchmark determined by banks, had been lowered by 10 basis points to 3 percent while the five-year LPR was reduced by the same margin to 3.5 percent

Most new and outstanding loans in China are based on the one-year LPR, while the five-year rate influences the pricing of mortgages.

The lending rate cut was announced just after five of China's biggest state-owned banks said they have trimmed their deposit interest rates.

Industrial and Commercial Bank of China, Agricultural Bank of China, China Construction Bank and Bank of China reduced deposit rates by 5 to 25 basis points for some tenors, according to rates shown on the banks' mobile apps.

The banks cut interest rates on time deposits by 5 basis points to 0.05 percent, reduced rates on one-year time deposits by 15 basis points to 0.95 percent and shaved off 25 basis points on three-year and five-year time deposits.

These deposit rate reductions should guide smaller lenders in making similar cuts. (Reuters)