BEIJING, Oct. 17 (Xinhua) -- China's incremental financial policy tools are likely to play a more explicit role in shoring up the country's financial support to the real economy, reported Economic Information Daily on Tuesday.
The Xinhua-run newspaper cited market experts as saying after data released by the Chinese central bank on Monday showed China's outstanding social financing grew eight percent year on year by the end of September.
Apart from the indicator, Renminbi-denominated lending expanded 8.1 percent year on year by the end of the third quarter and M2, a broad measure of money supply, rose 6.8 percent over data in 12 months ago, 0.5 percentage point higher than the comparable figure by the end of August.
The stabilizing M2 increase resulted from co-effecting of multiple factors, especially when recent rollout of incremental financial policy support boosted apparently recovery of financial market confidence, said the report quoting an authoritative source.
-- Better credit structure in Q1-Q3
Despite challenges from relatively lackluster effective financing demand, high carryover effect and ongoing economic structural transformation, these end-September financial data remained still in a reasonable range, said Dong Ximiao, chief researcher with Merchants Union Consumer Finance.
The high data base at the end of September 2023 partially spoke for changes in the growth pace of related financial data by this September, according to Dong, saying that since the beginning of this year, the carryover effect has eased a lot alongside adjustment in calculation methods of financial industry added value.
From a structural perspective, more credit resources flew to key economic sectors and the relatively weak fields, which, as experts held, corresponded to China's ongoing economic structural transformation in recent years.
For traditional sectors such as real estate and local government financing vehicles, credit need generally dwindled while green development and sci-tech innovation-enabled growth drivers have been pacing up although they may be insufficient to fill in the gap between past and current credit growths.
By the end of September, balances of inclusive loans for small- and micro-sized enterprises surged 14.5 percent year on year to 32.90 trillion yuan and mid- and long-term lending for manufacturing industries spiked by 14.8 percent year on year to 13.88 trillion yuan. For specialized, characteristic and innovative businesses, lending to them reported a 13.5 percent growth to 4.26 trillion yuan.
-- Solid support from financial sector
Along with debut of recent incremental financial policy support, financial resources are expected to flow more smoothly to key, strategic and prioritized sectors and relatively weak fields as well, representing solid and quality support to the real economy in the future, noted Wen Bin, chief economist with China Minsheng Bank.
When lending structure continued to optimize in China, corporate financing costs also dropped amid business runners' recovering confidence and investment activities.
For a petrochemical firm located in Huizhou City of Guangdong Province, a southern China powerhouse, the policy incentives that have debuted since the start of this year have translated into lower financing costs.
The company's related financing costs declined further to 2.85 percent from the 3.2 percent at the beginning of this year and might drop further after related monetary policies entered into effect, which enabled it to upsize expenditures on product R&D, market exploration and talent introduction.
Another textile company also headquartered in Guangdong rolled over its recently-expired borrowings at an interest rate of 100 basic points lower than last year's and planned to spend more on expanding production.
In the future, market watchers broadly believe that effective social demand is likely to recover step by step alongside the gradual implementation of these new financial policies and there is still a firm basis for financial indicators to grow stably.
As Wen deemed, China's monetary policy adjustment adapted to the changing economic situations in the past months of this year and against the backdrop of economic structural transformation and accelerating shift from old growth engines to new growth drivers, monetary policies and other macro-economic policies will function jointly in spurring more domestic demand, in particular consumption need, to pillar up the flexible balance of economic demand and supply.
(Edited by Duan Jing with Xinhua Silk Road, duanjing@xinhua.org)
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