Tag Archives: new bank lending

China Primes The Credit Pumps

China’s monetary policymakers have been putting their money where their mouths are. After weeks of expressions of concern over the volatility of the global economy and the risks slow growth in the U.S. and Europe’s euro debt crisis pose to the country’s growth, it is now clear that they have been pumping credit into the economy. New bank lending in December reached 640.5 billion yuan ($101 billion), up from 562.2 billion in November. The M2 measure of the money supply rose 13.6% year-on-year, up from November’s 12.7% y-o-y rise. (Announcement.) This goes a bit beyond the “fine tuning” of monetary policy that is the official stance. Both December numbers surprised economists, who are now convinced policy easing is well underway, and another cut in banks’ capital reserve ratios, symbolic though that is, likely before New Year.n


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