New yuan loans in China rose by CNY 589 billion in August of 2025, firmly below the CNY 900 billion extension in the corresponding period of the previous year and missing market expectations of a CNY 800 billion increase. It was the lowest amount of new yuan loans for the month since 2011, extending the current period of weak credit demand amid the weakening consumer appetite and the prolonged crisis for housing. The aggregates dropped despite efforts to loosen monetary conditions and stimulate borrowing by the PBoC, including lower borrowing and liquidity rates. In turn, aggregate financing, seen as a broader measure of credit, rose by CNY 2.57 trillion, above market forecasts of CNY 2.46 trillion but below the CNY 30.3 trillion from the corresponding period of the previous year. Smaller volume of government bond issuance also weighed on the pace of credit growth as Beijing's effort to curb capacity limited demand for new infrastructure and manufacturing investment.
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