In the first five months of 2024, banks in the Chinese mainland extended a significant 11.14 trillion yuan ($1.54 trillion) in new yuan-denominated loans, according to data released by the People's Bank of China, the country's central bank.
The broad money supply (M2), which encompasses cash in circulation and all deposits, saw a 7 percent year-on-year increase, reaching 301.85 trillion yuan by the end of May. In contrast, the narrow money supply (M1), covering cash in circulation plus demand deposits, decreased by 4.2 percent to 64.68 trillion yuan.
Additionally, the M0, representing the total cash in circulation, surged by 11.7 percent from the previous year to 11.71 trillion yuan as of end-May.
Despite these changes, newly added total social financing—a measure of funds flowing into the real economy—dropped to 14.8 trillion yuan in the first five months of the year, down by 2.52 trillion yuan compared to the same period last year.
Lian Ping, director of the Chief Industrial Research Institute of Guangkai, stated that the loan growth data aligns with the needs of the Chinese mainland's economy. He emphasized that the next step is to ensure a balanced allocation of credit systems within the year, avoiding excessive concentration or shortages during specific periods.
Reference(s):
China's January-May new yuan loans rise to 11.14 trillion yuan
cgtn.com
