PEKING (dpa-AFX) - Chinese new loan growth slowed in May as the central bank continued to tighten policy in an effort to tame inflation, data from the People's Bank of China showed Monday.
Chinese banks extended CNY 551.6 billion in local currency loans in May, below economists' expectations of CNY 650 billion. Outstanding amount of yuan loans at the end of May rose 17.1 percent year-on-year, the central bank said in a statement.
In April, banks lent CNY 739.6 billion, which was 17.5 percent higher than a year ago.
The broad money measure, or M2, rose 15.1 percent year-on-year in May, while expectations were for a 15.3 percent increase.
The M1 money supply registered a 12.7 percent increase compared to the 12.9 percent growth forecast by economists, while the M0, the currency in circulation, climbed 15.4 percent, faster than forecast for a 14.7 percent rise.
In May, the central bank raised the banks' reserve requirement for the fifth time this year, stepping up its fight against inflation. China has hiked the interest rate four times since October last year.
In its latest economic outlook report published last month, the Organization for Economic Co-operation and Development, or OECD, warned that if past tightening is insufficient, inflationary pressures are likely to build further, ultimately necessitating strong further policy actions and raising the risk of a much deeper slowdown in the medium term.
China's inflation eased slightly to 5.3 percent in April from a 32-month high of 5.4 percent in March. The statistical office is slated to publish the consumer price data on Tuesday and the rate of inflation is widely expected to show a jump to 5.5 percent in May.
Copyright RTT News/dpa-AFX
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