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China: Credit data deteriorate markedly in October, M2 growth picks up

November 12, 2015

New yuan loans totaled CNY 514 billion (USD 80.7 billion) in October, which came in below the CNY 1.1 trillion registered in the previous month. October’s reading also undershot the CNY 800 billion the markets had expected and represented a 15-month low. In the 12 months up to October, new yuan loans totaled CNY 12.0 trillion (September: CNY 12.0 trillion).

Total social financing—a broader measure of liquidity in the economy that includes loans, bonds and other non-traditional instruments—plummeted from CNY 1.3 trillion in September to CNY 477 billion in October. The reading was well below the CNY 1.1 trillion the market had expected and represented a 15-month low.

Meanwhile, annual growth in M2—the broadest measure of money supply in China—ticked up from 13.1% in September to 13.5% in October, beating market expectations of 13.2%.

The government set a M2 growth target of 12.0% for this year. FocusEconomics Consensus Forecast participants expect M2 to expand 12.3% in 2015, which is unchanged over the previous month’s forecast. In 2016, the panel sees M2 growth of 11.6%, which is up 0.1 percentage points from last month’s Consensus.


Author: Ricard Torné, Head of Economic Research

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China Money Chart


China Money October 2015

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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