The new loan in China grew stronger than expected to a record 4.9 trillion yuan ($720.21 billion) in January 2023, when People’s Bank of China (PBoC, central bank) efforts to revive the world’s second largest economy following lifting the strict control policy once morest the enemy. COVID-19.
A strong recovery in credit demand will be essential for this year’s economic recovery following epidemic control measures and the real estate crisis slowed growth. China’s economy stands at 3% in 2022, one of the lowest in nearly half a century.
According to the PBoC, new loans in January more than tripled compared to December and exceeded analyst expectations of 4 trillion yuan. Chinese banks tend to grant more loans at the start of the year to acquire higher-quality customers and gain market share, but the increase bolsters business hopes and consumer confidence is growing. improved rapidly following the epidemic control policy was abruptly lifted in December.
Zhou Hao, chief economist at Guotai Junan International, said China’s credit data was stronger than expected, suggesting that the credit support program remained strong at the start of the year.
[Trung Quốc tiếp tục cắt giảm lãi suất cho vay để hỗ trợ nền kinh tế]
Overall, this is a positive report and is likely to help the economy recover significantly in the first quarter of 2023. The next focus of the market will be on real estate purchases, which are highly correlated with bank credit.
Analysts believe improving credit conditions, coupled with robust infrastructure spending and supportive measures might boost economic growth to around 5% this year, even amid a backdrop the global environment deteriorates. However, the recovery momentum may be uneven, requiring support policies to last for a while.
The PBoC has pledged to come up with policies to support the economy, by keeping liquidity ample and reducing borrowing costs for businesses.
Analysts expect the PBoC to cut its benchmark lending rate in the first quarter of 2023. This is a measure to support the most difficult industries.
Tra My (VNA/Vietnam+)