12.09.202510:22:19UTC+00New Yuan Loans Contract

In August 2025, China's new yuan loans increased by CNY 589 billion, significantly below the CNY 900 billion seen in the same month the previous year and falling short of market expectations of a CNY 800 billion rise. This marked the lowest amount of new yuan loans for August since 2011, reflecting ongoing weak credit demand amid subdued consumer interest and a persistent housing crisis. Despite the People's Bank of China's attempts to ease monetary conditions and encourage borrowing—efforts that included reducing borrowing and liquidity rates—these measures did not yield significant results. Concurrently, aggregate financing, which is a more comprehensive indicator of credit activity, increased by CNY 2.57 trillion. While this figure exceeded market forecasts of CNY 2.46 trillion, it was still below the CNY 30.3 trillion recorded during the same period in the previous year. Furthermore, a reduced volume of government bond issuance contributed to the slowing pace of credit growth, as Beijing's strategies to control capacity restricted demand for new infrastructure and manufacturing investments.