Money supply to China was much higher than expected in April as the central bank provided more liquidity to further support the slowing economy.
The M2 index rose 10.5% in April compared to the previous year, exceeding the increase by 9.7% in March, and market estimates by 9.9%.
Chinese banks expand new yuan loans in April by 645.4 billion yuan ($ 95.1 billion), well below the 3.13 trillion yuan in March and the 1.52 trillion yuan expected by analysts .
“The growth of new yuan loans slowed significantly in April and was lower than the same period last year,” the central bank said in a statement.
Small and medium-sized enterprises have increased operational difficulties and the demand for effective financing has decreased significantly, the central bank said in a statement.
As a next step, the bank plans to stabilize credit supply and reduce financing costs as a next step, and will further encourage financial institutions to reduce real interest rates on loans and commissions.
Source: Capital
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