Data suggests China's economic momentum may continue in H2

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Chinese banks extended 1.27 trillion yuan (about 192.8 billion US dollars) of new loans in September, beating market forecasts, data from the country's central bank showed on Saturday.

In the second quarter, the Chinese economy expanded 6.9 percent from a year earlier. The second-quarter numbers put the economy on a strong footing to meet China’s growth target of around 6.5 percent in 2017, which would give policymakers room to defuse financial risks.

The Chinese economy this year has shown signs of stabilizing and growing more strongly, and the momentum may continue in the second half, Zhou Xiaochuan, the governor of the People's Bank of China, said on Saturday, adding that progress has been achieved in economic transformation.

Chinese banks extended 1.27 trillion yuan (about 192.8 billion US dollar) of new loans in September, beating market forecasts. /VCG Photo

Zhou said the country’s imports and exports have risen rapidly, its current account surplus has narrowed and fiscal income has kept growing.

China will pursue a proactive fiscal policy and a prudent monetary policy and aim to strengthen areas of weakness, deleverage and monitor and prevent risk in shadow banking and the real estate market, said Zhou, who spoke at a G20 summit meeting in Washington early this year.

Chinese banks extended more loans than expected in September, according to data published on Saturday, buoyed by demand from home buyers and companies, even as the government tightened the screws to wean the economy off its years-long addiction to cheap debt.

VCG Photo

In the first three quarters, Chinese banks extended 11.16 trillion yuan of new loans, 998 billion yuan more than the same period last year. New loans made to non-financial enterprises and government institutions hit 5.73 trillion yuan in the first nine months, indicating credit demand from the real economy.

By the end of September, outstanding yuan loans grew 13.1 percent from a year earlier to 117.76 trillion yuan.

The newly added total social financing, a broader measure of financing scale, reached 1.82 trillion yuan in September, up from 1.48 trillion yuan in August.

The stronger growth means that China's officials will have more room to address the growing debt problem, as China continues to place controlling risk and deleveraging at the forefront of financial policy this year.

(With inputs from Reuters)

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