Mubasher: Chinese bank lending fell more than expected to the lowest level since 22 months in October, due to seasonal factors, while regulators are still expected to increase support for a sluggish economy.
Chinese banks extended 661.3 billion yuan (CNY) ($94.54 billion) in new loans last October, compared with CNY 1.69 trillion in September, data by People’s Bank of China (PBoC) showed on Monday.
While this marked the weakest level since December 2017, Reuters-polled analysts expected new loans to drop to CNY 800 billion.
Chinese authorities have been pushing to ramp up bank lending and reduce financing costs for more than a year, most specifically smaller and private companies which account for a substantial portion of growth and jobs in the world’s second biggest economy.
Household loans, mostly mortgages, fell to CNY 421 billion last month, from CNY 755 billion in the previous month, while corporate loans dropped to CNY 126.2 billion, down from CNY 1.01 trillion.
The growth pace of broad M2 money supply came in at 8.4% in October on an annualised basis, unchanged from the preceding month.
Outstanding yuan loans rose by 12.4% year-on-year last month, ticking down from 12.5% in the prior month.
By 12:19 pm GMT, the USD/CNY pair rose by 0.24% to CNY 7.0094.