(Yicai Global) Feb. 13 -- China’s broad money supply (M2) and lending growth surpassed market expectations for last month, though expansion in social financing, a broad indicator of liquidity and credit in the economy, has leveled out, the country’s central bank said.
The M2 balance totaled CNY172.0 trillion (USD27.3 trillion) as of the end of January, a rise of 8.6 percent on the year, while growth in total volume of loans hit a record for the month of January at CNY2.9 trillion (USD459.1 billion), up CNY867 billion annually, new data released by the People’s Bank of China shows.
Annual growth in social financing came to CNY3.06 trillion, down CNY636.7 billion on the year before. The Chinese government invented social finance in 2011 as a means of better measuring liquidity compared to using money supply alone. It assisted Chinese leaders in supervising fundraising activities as the country’s financial system transitioned away from lending based on state-controlled policy.
Respondents to the most recent Yicai Chief Economist Survey predicted that new lending would jump to CNY2.15 trillion from CNY580 billion in December due to seasonal differences.
They also forecast a rise in M2 growth to 8.3 percent for last month, and that social financing would hit CNY3 trillion in the survey.
Outstanding loans in the household sector increased CNY901.6 billion, of which CNY310.6 billion and CNY591 billion are new short-term and mid- to long-term loans, respectively, PBOC data shows.