Financial industry performance remained stable inOctober as reflected in the deceleration of the rapid growth of broad money(M2), moderate growth of loans, improvement of credit structure and lowinterest rate in inter-bank market.
The growth of broad money (M2) decelerated, while thatof narrow money (M1) accelerated. At end-October, broad money (M2) stood atRMB28.76 trillion yuan, increasing by 18 percent year-on-year, up 0.1 and 4.5percentage points from the end-September and a year earlier respectively.Narrow money (M1) reached RMB10.18 trillion yuan, increasing by 12.1 percentyear-on-year, up 0.5 percentage points from the end-September. At end-October,the annualized month-on-month growth rate of M2 was 16 percent after seasonallyadjusted, down 7.6 percentage points from the end-September. Generallyspeaking, the rapid growth momentum of money supply in the last several monthswas decelerated, while the growth rate of M1 rebounded, indicating an increasedliquidity.
At end-October, cash in circulation (M0) increased by9 percent to RMB2.19 trillion yuan, with the growth increasing by 0.5percentage points from September. Cash withdrawl in October stood at RMB38billion yuan, RMB6.6 billion yuan less than that of the same period of 2004.
Loans increased moderately with the credit structureimproving continually. At end-October, outstanding loans denominated in bothlocal and foreign currencies in all financial institutions reached RMB20.36trillion yuan, increasing by 13.7 percent year-on-year, up by 0.2 and 0.4percentage points from end-September and a year earlier respectively.
At end-October, RMB loans increased by 13.8 percentfrom a year earlier to RMB19.12 trillion yuan, roughly the same level ofSeptember but up 0.5 percentage points from a year earlier. The annualizedmonth-on-month growth rate of RMB loans in October was 14.1 percent after seasonallyadjusted. In particular, outstanding balance of medium & long-term loansstood at RMB7.89 trillion yuan, increasing by 19.2 percent year-on-year, down0.6 and 5.7 percentage points from end-September and a year earlierrespectively. Outstanding balance of short-term loans and paper financingincreased by 10.8 percent year-on-year to RMB10.33 trillion yuan, up 0.3 and3.4 percentage points from end-September and a year earlier respectively.
New RMB loans in October reached RMB26.4 billion yuan,RMB 800 million yuan more than the growth of a year earlier. Short-term loansand paper financing fell by RMB27.4 billion yuan, RMB26.9 billion yuan lessthan the decline of a year earlier. New medium & long-term loans stood atRMB55.2 billion yuan, RMB28.8 billion yuan less than the growth of a yearearlier. Particularly, new capital construction loans reached RMB29.2 billion yuan,RMB20.1 billion yuan less than the growth of a year earlier. New loans grantedto households in October stood at RMB3.9 billion yuan, RMB9.3 billion yuan lessthan the growth recorded for the same period of 2004. New loans grantedto non-financial companies and other sectors reached to RMB22.5 billion yuan,RMB10.1 billion yuan more than the growth recorded for the same period of 2004.
Households’ deposits continued to increase rapidly,but corporate deposits decreased. At end-October, outstanding deposits in bothlocal and foreign currencies in all financial institutions stood at RMB29.44trillion yuan, increasing by 18 percent year-on-year, down 0.1 percentagepoints from end-September. Outstanding households’ deposits in both local and foreigncurrencies reached RMB14.49 trillion yuan, increasing by 17.9 percentyear-on-year, the same as September. Outstanding deposits of non-financialinstitutions stood at RMB13.3 trillion yuan, increasing by 19.3 percentyear-on-year, roughly the same as recorded at end-September.
At end-October, outstanding RMB deposits totaledRMB28.15 trillion yuan, growing by 19 percent year-on-year, down 0.1 percentagepoints from end-September. In particular, outstanding households’ RMB savingdeposits stood at RMB13.68 trillion yuan, increasing by 18 percentyear-on-year, down 0.1 percentage points from end-September.
New RMB deposits in October totaled RMB158.3 billion yuan,RMB13 billion yuan more than that recorded a year earlier. New households’saving deposits reached RMB51.1 billion yuan, RMB 3.1 billion yuan less thanthat recorded for the same period of 2004. Corporate RMB deposits fell by RMB60billion yuan, RMB29.3 billion yuan more than the decline recorded in the sameperiod of 2004; in particular, time deposits declined by RMB41.8 billion yuanmore than that recorded in the same period of 2004.
Outstanding deposits denominated in foreign currenciesreached US$159.9 billion, US$2.3billion more than that recorded inSeptember.
Inter-bank market witnessed acceleration in the growthof RMB transactions volume, with interest rate remaining at a relative lowlevel. RMB transactions in inter-bank market totaled RMB2.42 trillion yuan inOctober, with a daily average of RMB107.9 billion yuan, increasing by RMB59.1billion yuan or 121 percent compared with a year earlier. The monthly-weightedinterest rate for inter-bank borrowing average at 1.44 percent, down by 0.07percentage points from the end-September; and that for pledge-based bondrepurchase and outright bond repurchase averaged at 1.11 and 1.34 percent, downby 0.04 and 0.13 percentage points from the previous month respectively.
RMB exchange rate remained stable. At end-October, RMBexchange rate stood at 8.084 yuan per US dollar, down 90 basis points fromend-September.
