BEIJING: New bank loans in China rose to a three-month high in June as policymakers sought to keep ample funds in the financial system to support the slowing economy amid rising US trade pressure.
Most analysts have forecast the Chinese economy would stabilise in the second half of this year after a flurry of support measures, but weak data for June so far is raising expectations that more stimulus is needed.
Chinese banks extended 1.66 trillion yuan ($241.47 billion)in net new yuan loans in June, up from 1.18 trillion yuan in May but less than expected, according to data released by the People’s Bank of China (PBOC) yesterday.
The figure was also lower than the tally in June 2018.
Analysts polled by Reuters had predicted new loans would rise to a 5-month high of 1.7 trillion yuan. Lending typically picks up in June from May.
“The pick-up in lending has been modest relative to previous loosening cycles and is unlikely to prevent economic growth from slowing further in the coming quarters,” Capital Economics said in a note.
Household loans, mostly mortgages, rose to 761.7 billion yuan from 662.5 billion yuan in May, while corporate loans rose to 910.5 billion yuan from 522.4 billion yuan.
Broad M2 money supply rose 8.5 percent in June from a
year earlier, the same pace as May. Analysts had expected an 8.6
percent rise.
Outstanding yuan loans rose 13.0 percent on-year, well below an expected 13.4 percent and down from 13.4 percent in May. Some analysts say the annual comparison is a better way to assess trends in China’s credit growth, rather than more volatile monthly tallies. – Reuters
