Title: China’s Credit Growth and Low Loan Interest Rates Support Economic Recovery in First Quarter
Xinhua News Agency, Beijing, April 12
A recent report by the People’s Bank of China has revealed that the total amount of credit in the country has grown steadily in the first quarter, reaching historically high levels. Additionally, loan interest rates have remained at historically low levels, providing support to the real economy and creating a suitable monetary and financial environment for economic rebound and improvement.
According to the data released, RMB loans increased by 9.46 trillion yuan in the first quarter, marking a significant increase from the previous year. The total RMB loan balance now stands at 247.05 trillion yuan, with the stock of social financing at 390.32 trillion yuan and the balance of broad money (M2) at 304.8 trillion yuan. Experts believe that the credit growth is stable and balanced, providing solid support to the real economy.
The credit structure in China has also been optimized to improve quality and efficiency. Loans to enterprises increased by 7.77 trillion yuan, accounting for more than 80% of all new loans. The proportion of loans in new driving force areas such as inclusive small and micro businesses, green development, and technological innovation has continued to increase, with the growth rate remaining above double digits.
In an effort to further support technology-based small and medium-sized enterprises, the People’s Bank of China has announced the establishment of a 500 billion yuan re-loan for technological innovation and technological transformation with an interest rate of 1.75%. This move aims to encourage financial institutions to increase support for technology-based projects in key areas.
Furthermore, the report highlights that loan interest rates continue to fall and are at historically low levels. In March, the interest rates on newly issued corporate loans and personal housing loans were around 3.7%, down approximately 0.2 and 0.4 percentage points respectively year-on-year. This reduction in loan interest rates has helped reduce the loan interest burden on enterprises and residents, stimulating credit demand and supporting the stable development of the real estate market.
Overall, the data from the first quarter reflects a positive trend in China’s financial sector, with credit growth providing support to the real economy and low loan interest rates contributing to economic recovery and growth. Experts believe that the continued optimization of the credit structure and further initiatives to support new driving forces will fuel sustainable development in the future.