(Bloomberg) -- China’s credit in April shrank for the first time as government bond sales slowed, while loan expansion was worse than expected in a sign of...
-- China ’s credit in April shrank for the first time as government bond sales slowed, while loan expansion was worse than expected in a sign of weak demand.Ford Cuts Battery Orders as EV Losses Top $100,000 Per CarAggregate financing, a broad measure of credit, decreased by almost 200 billion yuan in April from the previous month, according to Bloomberg calculations of data released by the People’s Bank of China on Saturday.
“The volatility in this month’s data is tolerable because the government will issue ultra-long government bonds soon, so credit expansion in May and June may make up for it,” said Bruce Pang, chief economist for Greater China at Jones Lang LaSalle Inc. The PBOC has emphasized that markets shouldn’t look at the absolute growth rate of credit over the past few months, citing reasons including improving structure of credit that allows emerging industries to get more financial support. In a report published Friday, the central bank said that slower credit expansion is still sufficient to support the economy.
Authorities are also stepping up their support for the property market, which has been a major drag on the economy and credit growth. Hangzhou and Xi’an removed all curbs on residential property purchases recently, after the Politburo meeting called for research into ways to deal with unsold homes. A record cut to a reference rate for mortgages in February has failed to reverse sentiment in the housing market.
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