China's August new bank lending falls far short of expectations at 60 billion yuan
Macro
China's new yuan-denominated bank lending in August came in at 60 billion yuan, or 8.95 billion dollars, turning positive after July's record 340 billion yuan contraction, but falling far short of the 400 billion yuan recovery analysts had expected. A year earlier, the figure was 590 billion yuan. New lending for January through August totaled 10.44 trillion yuan, down from 13.46 trillion yuan in the same period a year earlier, underscoring how weak demand from households and the corporate sector continues to weigh on credit growth. The outstanding balance of yuan-denominated loans rose 4.9 percent in August from a year earlier, slowing from 5.1 percent in July and marking the weakest growth since records began. According to the central bank, broad money supply, or M2, rose 7.5 percent year on year in August, the lowest in 17 months and below the 7.6 percent analysts had expected, while the outstanding balance of total social financing, a gauge of credit and liquidity, rose 7.2 percent from a year earlier, slowing from 7.4 percent in July. The government is moving to support demand, expanding interest subsidies on loans to small and medium-sized private enterprises and individual consumers, and announcing it will inject 54 billion dollars into eight state-owned financial institutions to strengthen their core tier-one capital and sustain lending.
