New credit and social finance rebounded seasonally in August, and the industry expects that there is still a possibility of reducing reserve requirements within the year
2023-09-12
On September 11th, the People's Bank of China (hereinafter referred to as the "Central Bank") released financial data for August. Data shows that RMB loans increased by 17.44 trillion yuan in the first 8 months, an increase of 1.76 trillion yuan year-on-year. In August, RMB loans increased by 1.36 trillion yuan, an increase of 86.8 billion yuan year-on-year. The cumulative increase in social financing scale in the first 8 months was 25.21 trillion yuan, 842 billion yuan more than the same period last year. The increase in social financing scale in August was 3.12 trillion yuan, an increase of 631.6 billion yuan compared to the same period last year. At the end of August, the balance of broad money (M2) was 286.93 trillion yuan, a year-on-year increase of 10.6%. Wang Qing, Chief Macro Analyst of Dongfang Jincheng, told Securities Daily that against the backdrop of policy interest rate cuts and sustained efforts to stabilize growth policies in August, new credit and social finance rebounded significantly that month, and both showed year-on-year growth. This indicates that the current credit easing process has accelerated again, which will accumulate strength for the strengthening of economic recovery momentum in the future. Looking ahead, the policy will continue to support the process of widening credit. The scale of new credit and social financing in September is expected to further expand, and both will achieve a year-on-year increase. Credit structure continues to optimize. According to data from the central bank, RMB loans increased by 1.36 trillion yuan in August, an increase of 86.8 billion yuan year-on-year. From a sub sector perspective, household loans increased by 392.2 billion yuan, of which short-term loans increased by 232 billion yuan and medium to long-term loans increased by 160.2 billion yuan; Loans to enterprises and institutions increased by 948.8 billion yuan, including a decrease of 40.1 billion yuan in short-term loans, 644.4 billion yuan in medium and long-term loans, and 347.2 billion yuan in bill financing; Loans from non banking financial institutions decreased by 35.8 billion yuan. Wen Bin, Chief Economist of Minsheng Bank, told Securities Daily that the new RMB loans in August increased significantly by over 1 trillion yuan compared to the previous month, which is clearly stronger than seasonal patterns. Moreover, on the basis of reaching a historical peak in August last year, there is still an increase of 86.8 billion yuan year-on-year, which is not easy. This not only has policy support factors, but also indicates that market expectations and sentiment have improved. Since August, macro "combination boxing" has been continuously launched, and multiple important conferences have been held one after another. On August 1st, the Central Bank and the State Administration of Foreign Exchange held a work meeting for the second half of 2023, proposing to "vigorously support technological innovation, green development, and the development of small and medium-sized enterprises, and focus on enhancing new growth momentum"; On August 18th, the central bank and other three departments jointly held a video conference on financial support for the real economy and prevention and resolution of financial risks, proposing that "financial support for the real economy should be sufficient, with a stable pace, optimal structure, and sustainable prices"; On August 30th, the financial management department and the All China Federation of Industry and Commerce held a meeting to promote the development of financial support for private enterprises, further deploying financial support for the development of private enterprises. In addition, in mid August, the MLF (Medium Term Lending Facility) interest rate was once again lowered, driving a 10 basis point decrease in the one-year LPR (Loan Market Quotation Rate) for that month. In late August, various real estate optimization policies also continued to be implemented. Under the guidance of policies, banks have strengthened their support for the real economy, and new credit has significantly rebounded that month. Wen Bin said that medium to long-term loans from enterprises remain the main support, and residents are under pressure
Edit：Hou Wenzhe Responsible editor：WeiZe
Source：economic daily
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