In Depth: How Much Can Policy Lending Help Bolster China’s Economy?

China has brought back an irregularly used central bank lending program in a big way over the last few months to ramp up financing for housing and infrastructure projects, but how much it will help with the country’s flagging economic recovery remains uncertain.

Loans through the central bank’s pledged supplementary lending (PSL) program grew by a net 150 billion yuan ($20.9 billion) in January after rising by a net 350 billion yuan the previous month — the largest monthly increase since November 2022.