China new bank loans al­most halved in Oc­to­ber

The Myanmar Times - - International Business -

CHI­NESE bank lend­ing al­most halved month-on-month in Oc­to­ber as Bei­jing moved to rein in credit risks but with na­tional hol­i­days also an is­sue.

New loans ex­tended by banks fell to 651.3 bil­lion yuan (US$95.6 bil­lion) last month, com­pared with 1.22 tril­lion yuan in Septem­ber, said the Peo­ple’s Bank of China, the coun­try’s cen­tral bank.

Lend­ing surged in Au­gust and Septem­ber as the govern­ment in­jected credit into the econ­omy to spur ac­tiv­ity, but the rapid rise in bor­row­ing sparked alarm and Bei­jing has tried to curb the ex­pan­sion.

“Look­ing ahead, we ex­pect broad credit to re­sume its slow­down slide in com­ing months, as Chi­nese pol­icy mak­ers con­tinue to pri­ori­tise tack­ling credit risks over boost­ing eco­nomic ac­tiv­ity, which has held up well re­cently,” Ju­lian Evans-Pritchard of Cap­i­tal Eco­nomics said in a note.

An­a­lysts with ANZ bank also pointed to sea­sonal fac­tors, as “banks usu­ally slow their lend­ing ac­tiv­i­ties” in the fourth quar­ter as they ap­proach their lend­ing quo­tas.

The first week of Oc­to­ber is also a na­tional hol­i­day in China.

China’s econ­omy showed signs of sta­bil­is­ing in Oc­to­ber, with man­u­fac­tur­ing data surg­ing to a more than two-year high.

The pro­ducer price in­dex also rose 1.2pc year-on-year, af­ter end­ing more than four years of falls in Septem­ber. But ex­ports fell for the sev­enth con­sec­u­tive month.

China will re­lease more eco­nomic in­di­ca­tors to­day in­clud­ing in­dus­trial out­put and re­tail sales.

In a sep­a­rate state­ment, the cen­tral bank said to­tal so­cial fi­nanc­ing, an al­ter­na­tive mea­sure of credit in the real econ­omy, also plunged to 896.3 bil­lion yuan from the 1.72 tril­lion yuan in Septem­ber.

China’s to­tal debt hit 168.48 tril­lion yuan ($25 tril­lion) at the end of last year, equiv­a­lent to 249pc of GDP, the China Academy of So­cial Sciences has es­ti­mated. –

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