Yuan loans less than expected
0 Comment(s)
Print
E-mail Shanghai Daily, June 10, 2013
Chinese banks extended 667.4 billion yuan (US$109 billion) in new yuan loans last month, less than expected, as the economic slowdown negated businesses' need to borrow capital.
That compared to April's 792.9 billion yuan.
M2, a measure of money supply, rose 15.8 percent in May from a year earlier, compared to April's 16.1 percent. Total social financing, a measure of liquidity, was 1.19 trillion yuan in May, compared to April's 1.75 trillion, the People's Bank of China said.
"New loan growth slowed apparently from the first quarter," said Qu Hongbin, chief China economist with HSBC, adding: "There's still room for the government to keep a relatively loose monetary policy."
China's annualized economic growth slowed to 7.7 percent in the first quarter from 7.9 percent in the previous three months. The annual growth of 7.8 percent in 2012 was the weakest since 1999. In the first quarter, banks extended 2.76 trillion yuan in new yuan loans.
Premier Li Keqiang said on Saturday China's economy was generally stable, adding that growth was within a "relatively high and reasonable range." Li said China needs to make use of liquidity already in the economy to support real economic development and curb overcapacity.
A Shenyin and Wanguo Securities report said China's four biggest banks extended a combined 208 billion yuan of new yuan loans in May, the lowest in five months and even lower than the 216 billion yuan in February, which overlapped with the Spring Festival.
However, some analysts say China may not rush to further loosen monetary policy as M2 growth in May still exceeded the government target of 13 percent for the whole of 2013. "The central bank may not hurry to loosen the policy simply because consumer prices growth eased," said Everbright Securities Co senior analyst Zhong Zhengsheng.
Go to Forum >>0 Comment(s)