China’s lending slowed in November and money supply grew the least in a decade, highlighting the risk of a deeper slowdown in the world’s second-biggest economy.
New local-currency lending was 562.2 billion yuan ($88 billion), the People’s Bank of China said on its website today. That compares with 587 billion yuan in October. M2, a measure of money supply, rose 12.7 percent, the least since May 2001.
China’s leaders may take further steps to sustain the expansion as inflation cools and export growth weakens. The People’s Bank of China lowered lenders’ reserve requirements for the first time since 2008 effective Dec. 5, a “decisive” shift in policy stance that will support a lending pickup in coming months, according to London-based Capital Economics Ltd.
“Inflation is no longer a constraint on monetary policy,” Wang Tao, a Hong Kong-based economist with UBS AG said before the release. “Further weakness in real economic growth, such as exports, industrial production, and construction, will trigger more monetary easing.”
November lending compared with the 550 billion yuan median estimate in a Bloomberg News survey of 28 economists and M2 growth compared with a 12.8 percent median foreecast and a 12.9