March loans surge to highest in 14 months
By Feng Jianmin |
April 13, 2012, Friday
|
Print Edition
Print Edition
BANK lending in China surged in March to its highest in 14 months, central bank data released yesterday revealed.
Economists attributed the rise to the central bank's efforts to stabilize the economy, and said policy makers won't need to cut reserve requirements or interest rates immediately to replenish liquidity.
New yuan loans in March were 1.01 trillion yuan (US$160 billion), 332 billion yuan more than a year earlier, the People's Bank of China said. Economists polled by Reuters had expected a figure of around 800 billion yuan.
Banks gave a total 2.46 trillion yuan of new yuan loans in the first three months of this year, 217 billion yuan more than in the same period of last year. However, total social financing, including loans, bank acceptance bills, corporate bonds and equity financing, fell 348.7 billion yuan on an annual basis to 3.88 trillion yuan in the first quarter.
"While the recent improvement in credit growth is mainly a result of the central bank encouraging commercial banks to assist the completion of the many ongoing projects, it should help to calm investors' renewed anxiety about hard landing risks in China," Barclays Bank Plc said in a report yesterday.
The report attributed the drop in total social financing to the weak performance of the domestic stock market since the middle of last year, but said direct financing would rebound in the coming quarters.
"The overall improvement in financing conditions should support an early stabilization of economic activity and reduce the need for interest rate cuts or additional fiscal stimulus," the report said.
M2, the broadest measure of money supply, grew 13.4 percent in March from a year ago, 0.4 percentage point quicker than in February.
Economists attributed the rise to the central bank's efforts to stabilize the economy, and said policy makers won't need to cut reserve requirements or interest rates immediately to replenish liquidity.
New yuan loans in March were 1.01 trillion yuan (US$160 billion), 332 billion yuan more than a year earlier, the People's Bank of China said. Economists polled by Reuters had expected a figure of around 800 billion yuan.
Banks gave a total 2.46 trillion yuan of new yuan loans in the first three months of this year, 217 billion yuan more than in the same period of last year. However, total social financing, including loans, bank acceptance bills, corporate bonds and equity financing, fell 348.7 billion yuan on an annual basis to 3.88 trillion yuan in the first quarter.
"While the recent improvement in credit growth is mainly a result of the central bank encouraging commercial banks to assist the completion of the many ongoing projects, it should help to calm investors' renewed anxiety about hard landing risks in China," Barclays Bank Plc said in a report yesterday.
The report attributed the drop in total social financing to the weak performance of the domestic stock market since the middle of last year, but said direct financing would rebound in the coming quarters.
"The overall improvement in financing conditions should support an early stabilization of economic activity and reduce the need for interest rate cuts or additional fiscal stimulus," the report said.
M2, the broadest measure of money supply, grew 13.4 percent in March from a year ago, 0.4 percentage point quicker than in February.
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