BEIJING--Chinese banks stepped up lending in August after a decline in July, but new loans extended were still below expectations, casting a cloud over growth prospects for the world's second-largest economy.
Chinese banks issued 1.21 trillion yuan ($170 billion) worth of new yuan loans in August, up from CNY1.06 trillion in July, data from the People's Bank of China showed Wednesday.
Newly extended loans for August came in slightly below the CNY1.25 trillion forecast by a Wall Street Journal poll of 14 economists.
Chinese financial regulators have been trying to boost bank lending, particularly to struggling small private-sector businesses, which have been hit hardest by a cooling economy and a protracted trade war with the U.S. Small businesses provide a sizable share of jobs and economic output in the country.
Last Friday, the PBOC lowered the amount of money commercial banks are required to park at the central bank, unleashing $126 billion of funds for lenders to finance projects and boost consumer spending. Some economists believe more monetary easing will be rolled out in the coming months if growth shows more signs of weakness.
Total social financing, a broader measurement of credit in the economy that includes both bank loans and nonbank financing, came to CNY1.98 trillion in August, up sharply from CNY1.01 trillion in July. The rise was mainly due to recoveries from bank credit; bankers' acceptances, a type of corporate financing; and corporate bonds, according to the official data.
China's broadest measure of money supply, M2, was up 8.2% at the end of August compared with a year earlier, higher than the 8.1% rise at the end of July. The figure was also above the median 8.1% increase forecast by the WSJ poll.