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Chinese September new yuan loans, M2 money supply up despite increased crackdown

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Chinese September new yuan loans, M2 money supply up despite increased crackdown

Chinese September money supply growth bounced back from the record-low rate seen in August and new yuan loans also climbed despite an increased sector-wide crackdown by the authorities, data from the People's Bank of China showed Oct. 14.

The broad M2 money supply grew 9.2% from a year earlier to 165.57 trillion yuan, 0.3 percentage point higher than August's record low and 2.3% percentage points lower than the rate seen a year ago.

The narrower M1 amounted to 51.79 trillion yuan, up by 14% year over year. Growth was zero over the previous month, but came in 10.7 percentage points lower than the same period last year. Currency in circulation, or M0, amounted to 6.97 trillion yuan, up 7.2% annually and the net cash injection in first three quarters amounted to 144.5 billion yuan, the central bank data showed.

The central bank had warned in August that slowing money supply could be the "new normal" due to a crackdown on shadow lending.

Meanwhile, net new yuan loans in September were 1.27 trillion yuan, up from 1.09 trillion yuan in August. The month's growth gave a balance of 117.76 trillion yuan for yuan-denominated loans in the first three quarters.

Foreign-currency loans increased by 11.16 trillion yuan in September, compared with an increase of 10.162 trillion yuan in the same period last year. At the end of September, the balance of foreign-currency loans reached US$816.3 billion, the central bank said.

As of Oct. 13, US$1 was equivalent to 6.59 Chinese yuan.