PBOC releases first-half results

To maintain a prodent monetary policy in H2.

New renminbi-denominated loans reached RMB5.08 trillion (US$830 billion) in the first half of this year, higher by US$36 billion year-on-year, said the People's Bank of China.

For June alone, new renminbi-denominated loans amounted to US$140 billion, or US$9.67 billion less year-on-year. The total, however, was larger than the US$109 billion in May.

China’s social financing, a measure of funds raised by entities through bank credit and other means, amounted to US$1.65 trillion in the first half, a US$388 billion rise year-on-year.

PBOC has emphasized the government will maintain a prudent monetary policy; tap the idle capital and make good use of incremental capital, which is the core idea of the financial measures in the second half of this year.

Analysts estimate that for the whole year, new renminbi-denominated loans are likely to stand at around US$1.57 trillion, slightly higher than the 2012 figure of US$1.34 trillion. They believe Beijing is not very likely to curb credit too much in a bid to avoid a hard landing, which seems more likely.

M2, a broad measure of money supply that covers cash in circulation and all deposits, and also a key factor that affects price levels, increased 14% year-on-year to US$17.2 trillion at the end of June. The central bank has set a M2 growth target of 13% for 2013.