Data for new RMB loan in August turned in line with expectations, reaching RMB703 billion, though RMB10 billion less over one year earlier, according to data released by the People’s Bank of China.
China’s broadest measure of money supply, M2 growth data was 12.8%, as announced by China’s Premier Li Keqiang during the summer Davos summit in Tianjin, China.
The figure was well under previous market consensus of 13.5%, and this is the second time this year that M2 growth was under 13%, the first in March, 12.1%
Total social financing (TSF), a broad measurement of credit in the economy that includes bank loans, bonds and shadow-bank lending, increased dramatically from July’s RMB273 billion to RMB957 billion.
While TSF data boomed from July ‘s figure, the level of sequential TSF growth has been slowing. Among TSF components, the amount for newly increased RMB loans, entrusted loans, bank acceptance bills, and corporate bond issuance rose, while trust loans fell, according to an analysis report by Goldman Sachs.
As the demand for credits in the private sector is still soft, the Chinese authorities will maintain a proactive fiscal policy and are likely to roll out another round of pro-growth policies, according to an ANZ report.
