Apr 22, 2019 07:40 PM

Chart of the Day: Record Rise in New Short-Term Household Loans

China’s short-term household loans last month increased by the most since January 2015, driven by rising consumer loans amid an improving economy and easing financial conditions.

China’s short-term yuan loans to households in March were up 429.4 billion yuan ($63.99 billion) from February in the biggest increase since January 2015, when the central bank first released a combined figure on short-term household loans, according to a monthly report (link in Chinese) from the People’s Bank of China (PBOC) last week. The short-term loans to households totaled 13.9 trillion yuan in March. In February, the loans were down 292.6 billion yuan from January.


Among the 429.4 billion yuan increase, consumer loans jumped by 292.8 billion yuan and operating loans rose by 136.6 billion yuan, PBOC data showed.

March’s spike in loans was in part due to a low comparison base in February, according to Zhong Zhengsheng and Zhang Lu, analysts with consultancy CEBM Group, a subsidiary of Caixin Insight Group.

The growth in consumer loans were a sign of easing financing conditions, more money flowing into the real estate sector under the guise of short-term loans, and consumption growth driven by value-added tax cuts, which will lower consumer prices, they said in a note.

The increase of household loans has come with an upsurge in credit being issued. China’s total social financing, a broad measure of credit and liquidity in the economy, grew by a net 2.86 trillion yuan in March, much higher than a net increase of 703 billion yuan in February, PBOC data showed last week. The data suggested that credit growth may now be bottoming out due to the central bank’s efforts to loosen monetary conditions, Liu Chang, an economist with Capital Economics, said in a research note.

China’s economy grew by 6.4% year-on-year in the first quarter of 2019, unchanged from the rate logged in the last three months of 2018 and snapping a slowing streak in the last three straight quarters, official data showed on Wednesday.

Contact reporter Liu Jiefei (

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