Economics
China Central Bank Reassures on Policy After Credit Slows
- Local government debt swap helps slow new yuan loan growth
- M2 money supply likely to pick up after September: PBOC
The People's Bank Of China headquarters stands in Beijing.
Photographer: Tomohiro Ohsumi/BloombergThis article is for subscribers only.
China’s central bank reassured investors that monetary policy will continue to support the economy after a sharp slowdown in new credit last month, and said the lending slump was temporary.
The deceleration in the growth of new yuan loans in April was mainly due to a pick-up in a program to swap high-cost local government debt for cheaper municipal bonds, the People’s Bank of China said in a statement on its website on Saturday. No less than 350 billion yuan ($53.6 billion) of such swaps were conducted last month, while aggregating financing growth was affected partly by a decrease in corporate bond issuance, according to the central bank.