A blog on Chinese economy & society

China’s March bank lending moderates

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No, I won’t dramatize like Bloomberg by calling RMB500bn+ bank lending in a month as cooling off.

Chinese banks extended a less-than- estimated 510.7 billion yuan ($74.8 billion) of new loans in March after the central bank told lenders to set aside bigger reserves and pace credit growth.

The figure compares with 700 billion yuan in February and the median forecast of 709 billion yuan in a Bloomberg News survey of 21 economists. The central bank released the latest data on its Web site today.

Yes, March lending has moderated, especially when compared to the RMB7,001bn lending of March last year. However, the world was going to end back then and people could be forgiven for overindulging a bit. What should be noted in the story instead is that actual quota from the PBoC left to be drawdown in March was only RMB150bn. And M2 grew 22.5% YOY, way above the 17% target.

The bottom line is China is still having a binge in liquidity. The government either have to do some serious tightening soon,or…


Written by Cindy Luk

April 13, 2010 at 3:38 am

Posted in China, Macro

Tagged with ,

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