China Money


China: Credit indicators show mixed signals in April

May 10, 2013

New yuan loans totalled CNY 793 billion (USD 129 billion) in April, which was below the CNY 1.1 trillion seen in the previous month. That said, the reading overshot market expectations that had loans totalling CNY 768 billion. In the 12 months up to April, new yuan loans totalled CNY 8.6 trillion (March: CNY 8.5 trillion).

In addition, total social financing - a broader measure of liquidity in the economy that includes loans, bonds and other non-traditional instruments - moderated from CNY 2.5 trillion in March to CNY 1.8 trillion in April. Simultaneously, in order to manage liquidity from the money market, the People's Bank of China (PBOC) continued to conduct its twice-a-week reverse repurchasing operations.

Meanwhile, M2 - the broadest measure of money supply in China - rose 16.1% year-on-year in April (March: +15.7% yoy), exceeding market expectations that had M2 growth slowing to 15.5%.

The government targets an M2 growth of 13% for this year. FocusEconomics Consensus Forecast participants expect M2 will expand 13.4% in 2013, which is unchanged over the previous month's forecast. In 2014, the panel sees M2 growth at 13.0%.


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China Money Chart

China Money April 2013

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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