The People’s Bank of China released data on February 9, revealing an increase of 4.92 trillion yuan in RMB loans in January, marking a year-on-year increase of 16.2 billion yuan. Additionally, social financing saw a boost of 6.5 trillion yuan in January 2024, exceeding last year’s figures by 506.1 billion yuan. The balance of broad money (M2) was reported at 297.63 trillion yuan at the end of January, demonstrating an 8.7% year-on-year increase.
The new RMB loans data outperformed market expectations and indicated stable loan growth in January. Industry experts attributed this to the flexible and effective implementation of prudent monetary policies and various supportive measures for agriculture, small businesses, and the real estate sector.
Moreover, social financing scale was reported at 384.29 trillion yuan, highlighting a 9.5% year-on-year growth. While the M2 growth rate slowed down in January, it was analyzed as being influenced by seasonal factors, countercyclical monetary adjustments, and the overall economic recovery.
Industry insiders emphasized the need to look beyond high-frequency monthly data on money and credit, urging a comprehensive evaluation of financial support effectiveness, including interest rate reductions and the scale of social financing covering direct financing. They noted the impact of China’s economic structural transformation on credit growth and structure, suggesting a shift in focus to more holistic assessments of financial support intensity.
The data released by the People’s Bank of China suggests that the country’s financial system is maintaining a high level of support for the real economy and indicates a continued recovery of the economy.