China Money August 2017


China: M2 growth hits new low in August

September 15, 2017

Chinese banks extended CNY 1.09 trillion (USD 167 billion) in new yuan loans in August, below July’s CNY 826 billion. The print significantly overshot the CNY 900 billion markets had expected. In the 12 months up to August, new yuan loans totaled CNY 13.6 trillion (July: CNY 13.5 trillion).

Total social financing (TSF)—a broader measure of credit and liquidity in the economy that includes loans, bonds and other non-traditional instruments—rose from July’s CNY 1.22 trillion to CNY 1.48 trillion in August.

Meanwhile, annual growth in M2—the broadest measure of money supply in China—declined from 9.2% in July to 8.9% in August. The reading undershot the 9.2% that market analysts had expected and was the lowest rate since the current series began in 1996.

The government set an M2 growth target of 12.0% for this year. FocusEconomics Consensus Forecast participants expect M2 to expand 9.8% in 2017. In 2018, the panel sees M2 growth of 9.6%, which is down 0.5 percentage points from last month’s forecast.

Author:, Economist

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China Money Chart

China Money August 2017 0

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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