Chinese banks’ lending rises in November

AFP FILE PHOTO

SHANGHAI—Chinese banks boosted lending in November from October, official figures showed Tuesday, as Beijing seeks to preserve the budding recovery in the world’s second largest economy.

Chinese banks extended 522.9 billion yuan ($83.9 billion) in new loans last month, up from 505.2 billion yuan in October, the central bank said in a statement.

But the figure was below market expectations of 550 billion yuan, according to an average forecast of 15 economists polled by Dow Jones Newswires.

China has been encouraging bank lending to bolster economic growth, which has slowed for seven straight quarters and hit a more than three-year low of 7.4 percent in the third quarter, hurt by weak demand overseas and at home.

Policymakers have cut interest rates twice this year and trimmed the amount of cash banks must place in reserve three times since December 2011 as they try to encourage lending and pump up growth.

The government over the weekend released a series of figures showing continued strength in the domestic economy, but lower-than-expected trade data for November released on Monday underlined the fragility of the recovery.

Economists said the central bank will continue to maintain its relatively loose monetary policy but some ruled out the likelihood of immediate cuts in interest rates and banks’ reserve requirements.

“We expect the government to sustain the current policy stance which could be featured as marginally pro-growth without big-bang stimulus,” Lu Ting, China economist at Bank of America Merrill Lynch, said in a research note.