What’s New: China’s overall credit growth touched a two-year high in May thanks to supportive policies aimed at easing capital pressures for virus-hit businesses.
The outstanding amount of total social financing (TSF) reached 268.39 trillion yuan ($38 trillion) by the end of May, up 12.5% from a year ago and the highest monthly growth since April 2018, the People’s Bank of China said Wednesday.
The growth was mainly driven by government bond issuance, which totaled 1.14 trillion yuan in May and contributed nearly 36% of the aggregate financing. Financial institutions offered 1.48 trillion yuan of new loans in the month, 298.4 billion yuan more than the same time last year.
Get More: China’s social financing growth has picked up the pace since March, reflecting reviving businesses and easing policies. Analysts said they expected banks to further accelerate loan issuance in coming months in response to the central government’s call to support the real economy’s recovery from the pandemic.
Bank of Communications said in a research note that the central bank will maintain measures to keep market liquidity at an ample level, although the monetary authority fine-tuned policies in May to slightly slow the easing efforts.
Contact reporter Han Wei (weihan@caixin.com) and editor Bob Simison (bobsimison@caixin.com)
