Performance of the financial industry remained sound and stable this May, and macro-control policies started to take effect. Growth of money supply and loans moderated though medium and long term loans and foreign currency loans kept on increasing fast; growth of household savings deposits continued to fall; the money market interest rate and the exchange rate of Renminbi remained stable.
The growth of money supply moderated. At end-May, broad money supply M2 reached RMB23.48 trillion yuan, increasing year-on-year by 17.5 percent, 1.6 percentage points lower from the end of April. Narrow money supply M1 rose to RMB8.68 trillion yuan, increasing by 18.6 percent, 1.4 percentage points lower from the previous month. The annualized month-on-month growth rate of broad money supply M2 in May was 10 percent after seasonally adjusted, indicating a moderation of growth of money supply. Cash in circulation M0 totaled RMB1.9 trillion yuan. Net cash withdrawal in May alone was RMB83 billion yuan, RMB50.4 billion yuan more than the same period of last year. Rapid growth of consumption contributed to the large cash withdrawal.
Rapid growth of loans was markedly reined in. Outstanding loans denominated in both local and foreign currencies in all financial institutions totaled RMB18.25 trillion yuan at end-May, increasing by 19 percent on a year-on-year basis, 1.4 percentage points lower from the end of April. Balance of RMB loans reached RMB17.06 trillion yuan, increasing by 18.6 percent, 1.3 and 3.1 percentage points lower than the previous month and the same period of last year respectively. The annualized month-on-month growth rate was 11 percent after seasonally adjusted, representing a 7.5 percentage points decrease from the previous month. Medium and long term RMB loans continued to increase rapidly at the rate of 32.7 percent. New RMB loans in May were RMB113.2 billion yuan, RMB140.4 billion yuan less than the same period of last year. In particular, short-term loans and negotiable bills financing incremented by RMB29 billion yuan, with growth decreasing year-on year by RMB125.3 billion yuan; medium and long term loans grew by RMB85 billion yuan, RMB5.4 billion yuan less than the same period of last year. Balance of foreign currency loans increased rapidly by 26.6 percent to USD 144.1 billion at end-May.
Growth of household savings deposits continued to fall. At end-May, outstanding deposits denominated in both local and foreign currencies in all financial institutions (including foreign-funded ones) totaled RMB23.7 trillion yuan, increasing by 17.9 percent, 4 percentage points lower than the growth recorded a year earlier. RMB deposits reached RMB22.5 trillion yuan, increasing by 19.1percent, 1.3 percentage points lower than the previous month. In particular, household savings deposits totaled RMB11.26 trillion yuan, an increase of 16.9 percent, 0.9 percentage points lower than April. New RMB deposits in May was RMB268.8 billion yuan, with growth decreasing by RMB164.3 than a year earlier. In particular, growth of household savings deposits has decreased for consecutive four months. In May, household savings deposits increased RMB43.5 billion yuan, RMB72.3 billion yuan less than the growth recorded a year earlier. New corporate deposits were RMB124.5 billion yuan, RMB49.3 billion yuan less than the same period of last year. Foreign currency deposits totaled USD149.8 billion, approximately the same level as at the end of last May.
Inter-bank market interest rate remained stable. Turnover of RMB transactions in inter-bank market amounted to RMB844.4 billion yuan in May, with daily average reaching RMB46.9 billion yuan, decreasing by 3.5percent from the previous month. The monthly-weighted interest rate in inter-bank borrowing market averaged at 2.21percent, 0.06 percentage points down from the previous month. The monthly-weighted average interest rate in bond repurchase market stood at 2.1percent, 0.04 percentage points up over the previous month.
Renminbi exchange rate remained stable, being at 8.2769 yuan per US dollar at the end of May.
