ICYMI: New bank lending in China rose less than expected in March

Data from Friday from China showed new bank lending in China rose less than expected in March, although up from February. Broad credit growth hit a record low.

Chinese banks new yuan loans in March were 3.09 trillion yuan

• from 1.45 trillion yuan in February
• expected was 3.56 trillion yuan
• new loans were lower than 3.89 billion yuan in March 2023

M2 money supply +8.3% y/y

• slowest expansion since September 2023
• expected was +8.7%
• prior 8.7%

Total social financing (a broader metric of credit that also includes nonbank financing) was 4.87 trillion yuan

• better than expected of 4.70 trillion yuan
• for the first quarter was 12.93 trillion yuan, down by CNY1.61 trillion from the same period last year

Capital Economics:

• “Bank loan and broad credit growth in China both decelerated sharply in March,”

• “Given the persistent weakness of private credit demand any pick-up will be modest and short-lived, unless the PBOC shifts to a far more aggressive approach”
• “There is no sign of that happening – and current pressure on the renminbi makes substantial rate cuts even less likely”

(bolding mine)

Info via Reuters and Wall Street Journal.

This article was written by Eamonn Sheridan at www.forexlive.com.