Bank lending expands more than expected
Print Edition
China’s banks lent more than expected in September but money supply growth slowed as the economy stabilized and authorities may keep a relatively tight monetary policy.
New yuan loans totaled 787 billion yuan (US$128.8 billion) last month, the People’s Bank of China said in a statement yesterday. Banks lent 623.2 billion yuan in September last year while analyst estimates compiled by Bloomberg News were for 675 billion yuan.
M2, China’s broadest measure of money supply, rose 14.2 percent from a year earlier, meeting market expectations. But the growth slowed from the 14.7 percent expansion in August.
Total social financing, the broadest measure of credit supply including loans, bank acceptance bills, corporate bonds and equity financing, amounted to 1.4 trillion yuan, lower than the 1.65 trillion yuan a year ago.
“The higher-than-expected bank lending may partly be due to the central bank’s guidance in improving market liquidity,” said Zhang Lan, a researcher with the Bank of Nanjing. But he predicts the monetary authority “may continue to adopt a relative tight stance” as inflation has been rising in recent months.
Liu Qiyuan, an analyst at Qilu Securities, said authorities may control lending at the current level in the fourth quarter to prevent an economic downturn. They will also encourage financing through bonds and equity while keeping a prudent monetary policy, he added.
In the first three quarters of this year, new lending totaled 7.28 trillion yuan, up 557 billion yuan from a year earlier.
China’s inflation grew to a seven-month high of 3.1 percent in September as food costs rose amid poor weather and the Mid-Autumn Festival, official data showed yesterday.
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