China Money December 2016


China: Bank lending remains robust in December

January 12, 2017

Chinese banks extended CNY 1.04 trillion (USD 151 billion) in new yuan loans in December, an improvement from November’s CNY 795 billion. December’s print overshot the CNY 700 billion the markets had expected. In the full year 2016, new yuan loans totaled CNY 12.6 trillion (2015: CNY 11.7 trillion), which marked a record high.

Total social financing (TSF)—a broader measure of credit and liquidity in the economy that includes loans, bonds and other non-traditional instruments—moderated from November’s eight-month high of CNY 1.83 trillion to CNY 1.63 trillion in December.

Meanwhile, annual growth in M2—the broadest measure of money supply in China—inched down from November’s 11.4% to 11.3% in December. The reading came in slightly below the 11.5% rise the markets had expected and represented a five-month low.

FocusEconomics Consensus Forecast participants expect M2 to expand 11.3% in 2017, which is down 0.1 percentage points from the previous month’s forecast. In 2018, the panel sees M2 growth of 10.8%.

Author: Ricard Torné, Lead Economist

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China Money Chart

China Money December 2016

Note: New yuan loans in CNY billion and year-on-year variation of M2.
Source: People’s Bank of China (PBOC) and FocusEconomics calculations.

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