China's interest rates were cut for the third time in six months in hopes of lowering companies' borrowing costs and increasing the country's weakening economy, which is reportedly headed for its worst year in a quarter of a century. The announcement was made by The People's Bank of China, the nation's central bank, on Sunday.

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PBOC announced on its Web site that it was lowering its lending rate benchmark of one year by 25 basis points to 5.1 percent from May 11. The bank also cut its benchmark deposit rate by the same amount to 2.25 percent.

With China's interest rates cut down, the government aims to offshoot lending to businesses, as well as create added momentum for China's economy, which is considered to be the world's second largest after the United States.

Analysts have welcomed the expected rate cut move. However, according to Reuters, they have predicted that policymakers would relax reserve requirements and cut rates once more in the coming months to counter the issues facing the country's economy.

"China's economy is still facing relatively big downward pressure," said the PBOC. "At the same time, the overall level of domestic prices remains low, and real interest rates are still higher than the historical average."

As a result of the economic slowdown, the labor market is suffering, as reported by CNBC.

Maintenance of stable employment has reportedly been top priority for the Chinese government, which aims to steer their economy away from an export-driven model to one that is based on consumption.

The labor market has indeed held up in spite of the decline in growth, but there are still initial signs of strain emerging.

The Liaoning province government announced last month that its annual job creation target from 700,000 has been cut down to 400,000 to reflect a "severe" employment trend, Reuters reported.

The labor ministry had also warned authorities not to be "blindly optimistic" since the job creation is slowing.

China's interest rate cut on Sunday allegedly came just days after a weak April trade and inflation data. This data highlighted China's economy as being under consistent pressure from soft demand at home and abroad.

China's economy might be growing faster than any other major economy in the world; however, the slowdown has worsened in recent months, as reported by the New York Times.

Last month, the country said its economy grew by just 7 percent in the first quarter of the year. This is one of the lowest rates in a decade, way below the double-digit growth the country had been used to in the past few years.

In 2015, the government targeted a 7 percent growth, but policy makers are still concerned of the rapid decline in pace, and growth of much lower than 7 percent might create massive disturbances in their economy.

Many economists are not so happy about China's prospects in the coming years. 

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