BEIJING: China’s central bank cut interest rates for the third time in six months as it ratchets up support for an economy grappling with a debt overhang and property slump.The People’s Bank of China will reduce the one-year lending rate 0.25 percentage point to 5.1%, and cut the oneyear deposit rate by the same amount to 2.25%, effective Monday, the central bank said on its website Sunday. In another step to free up interest rates, the central bank will also raise the limit on what banks can pay savers. Inflation remained subdued and exports and imports both slid in April — underscoring the economy’s struggle to match Premier Li Keqiang’s 2015 growth target of about 7%. With capital flowing abroad and local governments embroiled in a complex debt cleanup, economists anticipate further easing. "The economy requires substantial stimulus to get back on its feet," said Frederic Neumann, co-head of Asian economics research in Hong Kong at HSBC Holdings. "But monetary easing on its own may not do the trick: China also requires a fiscal kick to steady demand."The latest interest-rate reduction adds to China’s own steps and that of at least 30 countries that have loosened monetary policy this year as lower commodity prices give room to stimulate. It also illustrates a divergence of policy direction between the world’s two biggest economies, with analysts forecasting the US Federal Reserve will lift borrowing costs later this year for the first time since 2006."The People’s Bank has the luxury of having plenty of room to maneuver and is willing to use it," said Mark Williams , Chief Asia Economist at Capital Economics . China is accelerating reforms and seeing volatile external demand, the PBOC said in a statement accompanying the decision. The "economy faces relatively large downward pressure," the PBOC said. "The overall inflation level is low, the real interest-rate level is above the historical average, for which there was room to use the interest-rate tool."Ma Jun, chief economist with the research bureau of the PBOC, said the central bank has room to use other tools such as required deposit reserve ratio and other conventional policies.