China's banks unexpectedly extended less credit in March - RTRS

The latest money supply data published by the Chinese central bank (PBOC) on Friday, showed that China's banks unexpectedly extended less credit in March than in the previous month, Reuters reports.

The reason cited by less credit supply last month is in response to government’s efforts to contain the risks from an explosive build-up in debt and an overheating housing market.

Key Quotes:

“China's banks made 1.02 trillion yuan ($148.15 billion) in new loans in March, down from 1.17 trillion yuan in February. Analysts polled by Reuters had predicted 1.25 trillion yuan.”

“However, China's banks still extended the third highest loans on record for a single quarter, totaling 4.22 trillion yuan in January-March.”

“Broad M2 money supply (M2) in March grew 10.6 percent from a year earlier, central bank data showed on Friday, the slowest monthly growth since July and missing forecasts for an 11.1 percent expansion.”

“Outstanding yuan loans grew 12.4 percent by month-end on an annual basis, lower than an expected 12.7 percent rise.”

“China has also lowered its target for broad money supply growth to around 12 percent from about 13 percent for 2016, signaling a bid to rein in debt risks while keeping growth on track.”