(Yicai Global) Feb. 7 -- China's social financing, a broad gauge of credit and liquidity in the economy, may have climbed by more than CNY4 trillion (USD573 billion) last month, online news outlet The Paper reported, citing analyses from several securities companies. January is traditionally a peak month for credit supply.

Huatai Securities expects newly added credit to have increased by CNY4.5 trillion, a jump of 10.5 percent year of year. While Guangda Securities forecasts CNY4.3 trillion in social financing gains, with newly issued government and corporate bonds reaching around CNY400 billion (USD573 million) and CNY700 billion respectively.

The ongoing coronavirus epidemic has had a negative impact on consumer businesses in China but does not seem to have cast much of a shadow over social financing. Special bonds released by local governments, fund-raising through the sale of corporate debt and undiscounted bills have all contributed greatly, Huatai Securities added.

CIB Research, a unit of China Industrial Bank, predicts newly added yuan loans came to CNY3.5 billion last month. Minsheng Securities, on the other hand, expects new credit to have been around CNY3 trillion. This is slightly less than the CNY3.2 trillion added over the same period in 2019 due to the early start of the Chinese New Year holiday this year.

Recent cuts in the reserve requirement ratio have enabled Chinese banks to extend more credit. As a result, corporate loans for the short, medium and long term last month will have kept good momentum, Minsheng Securities added.

The loan prime rate, which was introduced last year to help cut financing costs for businesses, is generally seen as on a downward trend. As a result, commercial banks are likely to accelerate the pace of credit supply. Some banks are loosening lending policies to provide more support to Hubei province and other regions severely affected by the epidemic.

Less short-term credit is expected to have been issued to individuals in January, while the amount of medium-and long-term loans similar to 2019.

Apart from a negative impact from end-of-year tax payments, the People's Banks of China's regulation of liquidity, credit supply, bond issuance and other factors have all had a positive impact on M2 broad money growth, the Bank of Communications' financial research center said. Financial institution's bong buying at the start of the year has also helped create liquidity, it added.

The M2 growth rate is expected to have remained at around 8.7 percent in January, according to the securities firms.

Editor: Kim Taylor