China’s Growth Rate of Total Social Financing Recorded the Highest in Two Years

Total social financing in China grew by 12.8% y/y in June, accelerating for a fourth consecutive month and reaching the highest pace since April 2018. China’s money supply M2 grew by 11.1% y/y, unchanged compared to the previous two months.

The faster growth of the total social financing, a broad measure of credit and liquidity in the real economy, and the M2 growth are in line with the monetary policy stance announced during the National Congress session in May 2020. According to the authorities, the growth rates of M2 money supply and total social financing are likely to increase beyond 9% and 12%, respectively, and to support the real economy.

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