China Credit Gets a Lift From Bond Sales as Loan Growth Slows
- Government bond sales account for increasing share of credit
- Loan growth at a fresh record low as mortgages remain weak
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China’s credit growth received a boost from more government bond sales in May, but loans slowed again in a sign of stalling demand.
The stock of aggregate financing — a broad measure of credit — expanded 8.4% from a year ago, slightly above April’s figure. The acceleration was largely due to a pickup in government borrowing, with 1.2 trillion yuan ($165 billion) of bonds issued in the month. But the stock of outstanding loans grew at an 8.9% pace, the slowest on record, and the broad M2 measure of money supply growth also weakened.