SHANGHAI/SINGAPORE China's central bank is expected to keep borrowing costs unchanged but ramp up liquidity support when it rolls over 500 billion yuan ($68.44 billion) worth of medium-term policy loans on Monday, a Reuters survey of market watchers showed.

The People's Bank of China (PBOC) is walking a tight rope between keeping liquidity ample to aid a struggling economy and stabilising the yuan amid expectations of "higher for longer" U.S. rates.

Most traders and analysts expect the PBOC to inject fresh funds to ease funding conditions as heavy bond issuances and tax collections by the government in October will likely cause liquidity concerns.

The Chinese economy, the world's second biggest, has shown signs of stabilising in the last month or so, although many analysts say the government might need to step up support measures to bolster the recovery. Fiscal steps may be the way to go, they say, given that significant monetary stimulus could hammer an already weak yuan.

All 28 market watchers surveyed this week predicted that the PBOC would keep the interest rate on one-year medium-term lending facility (MLF) loans unchanged at 2.5% for the monthly rollover on Monday.

Twenty-one respondents, or 75%, expected fund offerings by the PBOC to exceed the 500 billion yuan maturing, with approximately 100-200 billion yuan fresh fund injections, while the other seven forecast the central bank would just extend all the maturing loans.

Towards the year-end, pressure is seem coming from funding conditions and supplies of government bonds, said analysts at TF Securities.

The scale and pace of government and special refinancing bonds issuances are beyond expectations, which is causing temporary pressure on funding conditions, the analysts said.

Many market watchers also expect policy makers to deliver fiscal stimulus measures, as any further interest rate cuts could put the yuan currency under more pressure from a widening yield gap with the United States.

However, some analysts still think cutting policy rates is a possibility in the fourth quarter.

Xing Zhaopeng, senior China strategist at ANZ, expects the PBOC to cut policy rates every quarter from now on, citing lacklustre domestic demand and a deepening property crisis.

($1 = 7.3060 Chinese yuan renminbi)

(Reporting by Li Gu in Shanghai and Tom Westbrook in Singapore; Editing by Shri Navaratnam)