China: Growth in new yuan loans and total social financing falls below expectations in July
August 12, 2019
In July, Chinese banks distributed CNY 1.06 trillion (USD 151 billion) in new yuan loans, a three-month low. The print was below the prior month’s CNY 1.66 trillion and market expectations of CNY 1.25 trillion; the drop in loans, however, was likely affected by seasonality. In the 12 months up to July, new yuan loans totaled CNY 16.4 trillion (12 months up to June: CNY 16.8 trillion).
Meanwhile, annual growth in M2—the broadest measure of money supply in China—eased to 8.1% in July from 8.5% in June, marking the softest reading since February. The print was short of the 8.4% rise that market analysts had expected.
Total social financing (TSF)—a broader measure of credit and liquidity in the economy that includes loans, bonds and other non-traditional instruments—fell from CNY 2.26 trillion in June to CNY 1.01 trillion. Market analysts had expected CNY 1.50 trillion.