(Yicai Global) April 13 -- Consumer loans in Shanghai tumbled CNY17 billion (USD2.7 billion) in the first quarter from the same period last year, as opposed to a gain of CNY27.7 billion in the first three months of 2021, as the latest Covid-19 outbreak hammers consumer confidence.

Of this, personal housing loans increased by CNY16.3 billion in the three months ended March 31, nearly half the gain of CNY30.3 billion a year earlier, while car loans fell by CNY12 billion, compared with a gain of CNY300 million the year before, according to a report released by the Shanghai branch of the People’s Bank of China.

“The recent outbreak has suppressed demand for real estate in the short term, and time is needed for the property market to recover,” Zhou Maohua, a macro analyst at China Everbright Bank, told Yicai Global. The lockdown has also affected consumer demand for services and non-essential products, he added.

Corporate loans increased by CNY322 billion (USD50.3 billion), of which CNY149 billion were short-term loans and CNY164.8 billion were medium- and long-term loans, demonstrating that banks are boosting support for the real economy.

Chinese yuan-denominated loans dipped 7.7 percent to CNY337.3 billion (USD53 billion). As of the end of March, Shanghai’s balance of yuan loans was CNY9.16 trillion (USD1.4 trillion), a gain of 12.2 percent from a year earlier. This was an increase of 1.8 percentage point on the growth rate in the same period last year, and of 0.1 percentage point from the previous month.

Editor: Kim Taylor