--- SEARCH ---
WEATHER
CHINA
INTERNATIONAL
BUSINESS
CULTURE
GOVERNMENT
SCI-TECH
ENVIRONMENT
SPORTS
LIFE
PEOPLE
TRAVEL
WEEKLY REVIEW
Film in China
War on Poverty
Learning Chinese
Learn to Cook Chinese Dishes
Exchange Rates
Hotel Service
China Calendar
Trade & Foreign Investment

Hot Links
China Development Gateway
Chinese Embassies

Loan Growth, Money supply Increase in April

China's money supply and loan growth continued on a steady path last month, but analysts say financial conditions are still relatively tight.

 

The broad measure of money supply, or M2, rose 14.1 per cent on a year-on-year basis in the first four months of the year, the People's Bank of China (PBOC) said on Friday.

 

The rate of growth was 0.1 percentage points faster than was recorded one month earlier but 5 percentage points down from the end of last year.

 

Outstanding local currency loans increased by 12.5 per cent from a year earlier to 18.7 trillion yuan (US$2.3 trillion) at the end of April, 0.5 percentage points slower than a month earlier.

 

"It's largely within our expectations," said Wang Zhao, an analyst with the Development Research Centre of the State Council, China's cabinet.

 

"It's still on the tight side," he noted, adding administrative measures need to be loosened.

 

China's financial authorities took a slew of measures last year, including administrative land controls and credit curbs, to contain rapid growth in bank loans and money supply.

 

The fast loan and money supply growth has prompted worries about overheating in the rapidly developing Chinese economy.

 

Subsequently, the growth in loans and money supply slid abruptly causing worries among some analysts that the tightening may be overshooting.

 

But others believe the money supply growth remains fast.

 

"Faster M2 growth reflects very accommodative financial conditions owing to low interest rates and the undervalued currency. Sluggish loan growth is likely the result of the recent tightening of regulations for the banking system," said Liang Hong, China economist for Goldman Sachs (Asia), in a statement.

 

"Therefore, although we expect a soft year-on-year CPI (consumer price index) reading for the second quarter of 2005 because of the high base last year, pressures on the inflation front are likely to build up again in the second half of this year," she added.

 

(China Daily May 14, 2005)

 

Money, Loan Growth See Moderate Pick-up
Finance Operates on 'Right Track'
Central Bank: Money Supply Growth Slows Down
Money Supply Still Increasing, But Not So Fast
Loan Growth Declines: Central Bank
Analysis: Central Bank Moves to Stabilize Markets
M2 Growth Picks up Speed: Central Bank
Print This Page
|
Email This Page
About Us SiteMap Feedback
Copyright © China Internet Information Center. All Rights Reserved
E-mail: webmaster@china.org.cn Tel: 86-10-68326688