SINGAPORE—Banks in China cut benchmark interest rates on loans to households and businesses, a small attempt to help revive growth in an economy struggling with a property bust and Beijing’s zero-tolerance to Covid-19.

The People’s Bank of China last week unexpectedly trimmed two of its policy rates in response to slowing growth and feeble demand for credit. Changes to so-called loan prime rates, which are set by a panel of banks and represent the terms offered to the most creditworthy borrowers, usually follow soon after.