China announced Thursday that it would cut interest rates in a bid to boost the economy, as it battles the economic fallout of the new coronavirus outbreak.

The reduction in the loan prime rate (LPR), one of the preferential rates commercial banks impose on their best customers and which serves as a reference for other lending rates, is the latest measure to help companies struggling through the epidemic.

The one-year LPR was lowered to 4.05 percent from 4.15 percent, the People's Bank of China (PBoC) said in a statement. The five-year LPR, on which many lenders base their mortgage rates, was also lowered to 4.75 percent from 4.8 percent.

The LPR, released on the 20th day of every month, is based on rates of the central bank's open market operations, especially medium-term lending facility rates.

