China is likely to remove the lower limit on the bank lending rate, in a step to further interest rate reform, China Securities Journal reported on Friday.

But analysts said the measure would only have a limited effect on the financial markets because current lending rates are generally higher than the benchmark level among financial institutions.

The reform will not touch on the cap of the deposit rate, which is 1.1 times the benchmark rate, China Securities Journal reported. Reform will start with long-term deposit rate, before eventually removing the cap, experts said.