China's credit growth accelerates in May on fiscal boost

China issued 10.68 trillion yuan ($1.5 trillion) in new yuan-denominated loans in the first five months of 2025, according to the People's Bank of China, the country's central bank.

The M2, a broad measure of money supply that covers cash in circulation and all deposits, increased 7.9 percent year-on-year to 325.78 trillion yuan as of the end of May.

Meanwhile, the total social financing stock in China reached 426.16 trillion yuan as of the end of May,  a year-on-year increase of 8.7 percent. Analysts say the rapid growth of aggregate social financing in May has been driven by the issuance of government bonds.

"The issuance of government bonds has been front-loaded this year, with net financing exceeding 3.8 trillion yuan in the first quarter," said Dong Ximiao, chief researcher at Merchants Union Consumer Finance Co., Ltd.

"Additionally, the pace of local government special bond issuance has accelerated, with monthly issuance hitting a new high for the year," he added.

In the first five months, household loans increased by 572.4 billion yuan, while loans to enterprises increased by 9.8 trillion yuan.

The M1, which covers cash in circulation, demand deposits and clients' reserves of non-banking payment institutions, stood at 108.91 trillion yuan by the end of May, up 2.3 percent year-on-year.

Proactive fiscal policies are gaining traction, and financial stimulus measures in May have boosted market confidence, said Dong.

(With input from Xinhua)