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China’s October New Lending Tumbles More than Expected despite Policy Support

A masked woman walks at a fashion boutique displaying posters to promote Singles' Day discounts at a shopping mall in Beijing, Monday, Nov. 11, 2024. (AP)
A masked woman walks at a fashion boutique displaying posters to promote Singles' Day discounts at a shopping mall in Beijing, Monday, Nov. 11, 2024. (AP)
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China’s October New Lending Tumbles More than Expected despite Policy Support

A masked woman walks at a fashion boutique displaying posters to promote Singles' Day discounts at a shopping mall in Beijing, Monday, Nov. 11, 2024. (AP)
A masked woman walks at a fashion boutique displaying posters to promote Singles' Day discounts at a shopping mall in Beijing, Monday, Nov. 11, 2024. (AP)

New bank lending in China tumbled more than expected to a three-month low in October, as a ramp-up of policy stimulus to buttress a wavering economy failed to boost credit demand.

Chinese banks extended 500 billion yuan ($69.51 billion) in new yuan loans in October, down sharply from September and falling short of analysts' expectations, according to data released by the People's Bank of China (PBOC).

Economists polled by Reuters had predicted a fall in new yuan loans to 700 billion yuan last month from 1.59 trillion yuan the previous month and against 738.4 billion yuan a year earlier.

"Corporate financing demand remains weak due to poor profitability," said Luo Yunfeng, an economist at Huaxin Securities. "Credit demand may not pick up soon despite recent central bank policy measures."

The PBOC does not provide monthly breakdowns but Reuters calculated the October figures based on the bank's Jan-October data released on Monday, compared with the Jan-September figure.

The PBOC said new yuan loans totaled 16.52 trillion yuan for the first ten months of the year.

Household loans, including mortgages, dropped to 160 billion yuan in October from 500 billion yuan in September, while corporate loans dipped to 130 billion yuan from 1.49 trillion yuan, according to Reuters calculations based on central bank data.

Chinese policymakers have been working to arrest further weakness in an economy stuttering in recent months from a prolonged property market downturn and swelling local government debt.

Among their goals is to tackle the side-effects from a mountain of debt left from previous stimulus dating back to the 2008-2009 global financial crisis.

China's central bank governor Pan Gongsheng said China will step up counter-cyclical adjustment and affirm a supportive monetary policy stance, a central bank statement showed on Monday, citing a report Pan delivered to the top legislative body last week.

In late September, the central bank unveiled an aggressive stimulus package including rate cuts, and Chinese leaders pledged "necessary fiscal spending" to bring the economy back on track to meet a growth target of about 5%.

MORE STEPS ON THE CARDS

China unveiled a 10 trillion yuan debt package on Friday to ease local government financing strains and stabilize flagging economic growth, as it faces fresh pressure from the re-election of Donald Trump as US president.

New measures planned will include sovereign bonds issuance to replenish the coffers of big state banks, and policies to support purchase of idle land and unsold flats from developers, Finance Minister Lan Foan said.

Analysts at OCBC Bank expect the central bank to deliver another cut in banks' reserve requirement ratio in November or December to support the planned bond issuance.

China watchers are skeptical the steps will produce a near-term boost in economic activity as most of the fresh funds will be used to reduce local government debt, but China's central bank said it will continue supportive monetary policy to create a favorable monetary and financial environment for economic growth.

The PBOC also said it will study and revise money supply statistics to better reflect the real situation of the country's money supply.

Trump's election win could also prompt a stronger fiscal package in expectations of more economic headwinds for China. Trump threatened tariffs in excess of 60% on US imports of Chinese goods, rattling China's industrial complex.

Broad M2 money supply grew 7.5% from a year earlier, central bank data showed, above analysts' forecast of 6.9% in the Reuters poll. M2 grew 6.8% in September from a year ago.

Outstanding yuan loans grew 8.0% in October from a year earlier. Analysts had expected 8.1% growth, the same pace as in September.

The outstanding total social financing (TSF), a broad measure of credit and liquidity in the economy, slowed to a record low of 7.8% in October, from 8.0% in September. Acceleration in government bond issuance could help boost growth in TSF.

TSF includes off-balance sheet forms of financing that exist outside the conventional bank lending system, such as initial public offerings, loans from trust companies, and bond sales.

In October, TSF fell to 1.4 trillion yuan from 3.76 trillion yuan in September. Analysts polled by Reuters had expected TSF of 1.55 trillion yuan.

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IEA Hails Saudi Arabia’s ‘Rapid Response’ to Strait of Hormuz Crisis

This photograph shows the entrance to the International Energy Agency (IEA) headquarters in Paris on March 11, 2026. (AFP)
This photograph shows the entrance to the International Energy Agency (IEA) headquarters in Paris on March 11, 2026. (AFP)
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IEA Hails Saudi Arabia’s ‘Rapid Response’ to Strait of Hormuz Crisis

This photograph shows the entrance to the International Energy Agency (IEA) headquarters in Paris on March 11, 2026. (AFP)
This photograph shows the entrance to the International Energy Agency (IEA) headquarters in Paris on March 11, 2026. (AFP)

Countries must resist the urge to hoard oil and fuel during the energy crisis triggered by the US-Israeli war on Iran, head of the International Energy Agency Fatih Birol warned on Sunday, with supplies expected to dwindle further if the Strait of Hormuz remains closed.

Birol praised Saudi Arabia for its rapid response to the crisis, after it rerouted over two-thirds of its oil exports through a pipeline to the Red Sea, bypassing the strait.

“I urge all countries not to impose bans or restrictions on exports,” Birol told the Financial Times. “It is the worst time when you look at the global oil markets. Their trade partners, their allies and their neighbors will suffer as a result.”

While he was careful not to name China directly, Birol’s comments appear to be aimed at Beijing.

China is the only major country to have banned the export of petrol, diesel and jet fuel in response to the five-week-old war, although India has imposed extra duties on exports.

Birol said “major countries in Asia who hold major refineries” should rethink any ban.

“If those countries continue to restrict or totally ban exports, the impact on the Asian markets will be dramatic.”

His plea for countries to avoid bans may also be pointed at the US, where rumors of a potential ban on refined fuel exports are circulating as gasoline prices pass $4 a gallon and California faces the threat of jet fuel shortages.

While the US supported a G7 call for no export bans, its energy secretary Chris Wright has so far only ruled out a ban on crude oil exports.

Birol said some countries are already hoarding energy, undermining the impact of the IEA’s move to release 400 million barrels of crude and fuel from emergency reserves in an effort to stabilize markets during the current conflict.

“Unfortunately, we see that some countries are adding to their existing stocks during our coordinated oil stock release,” he said. “They are stocking up. This is not helpful. In my view this is a time for all countries to prove they are a responsible member of the international community.”

Saudi response

Birol praised Saudi Arabia for its rapid response to the crisis, after it rerouted over two-thirds of its oil exports through a pipeline to the Red Sea, bypassing the strait.

He said he had been reassured by the “highest authorities in Saudi Arabia” that this key pipeline is “well protected.”

Birol, who as head of the IEA has been at the heart of discussions over how to respond to the crisis, warned that “in April, we will lose twice the amount of crude oil and [refined] products we lost in March” if the Hormuz Strait does not reopen to shipping.

In normal times, one-fifth of the world’s oil and liquefied natural gas flows through the waterway, which has been all but closed by Iranian threats to fire upon shipping.

“We are following all the key energy assets in the region on a daily or hourly basis,” he said, referring to oil and gas fields, pipelines, refineries and LNG terminals. “Currently there are 72 energy assets damaged and one-third are severely or very severely damaged,” he added.

Birol also said the current crisis would redraw the world’s energy system, as did previous crises in the 1970s and the one triggered by Russia’s full-scale invasion of Ukraine in 2022.

He predicted that the current crisis would trigger another nuclear revival, a boom in electric vehicles and a push for more renewables, as well as prompting some countries to burn more coal. But he said the gas industry, which had presented itself as a reliable supplier, would have to “work hard to regain its reputation” after two energy shocks in four years.

Business

JMMC Holds 65th Meeting via Videoconference, Discusses Energy Security and Market Stability

General view of Saudi Aramco's Ras Tanura oil refinery and oil terminal in Saudi Arabia May 21, 2018. REUTERS/Ahmed Jadallah
General view of Saudi Aramco's Ras Tanura oil refinery and oil terminal in Saudi Arabia May 21, 2018. REUTERS/Ahmed Jadallah
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JMMC Holds 65th Meeting via Videoconference, Discusses Energy Security and Market Stability

General view of Saudi Aramco's Ras Tanura oil refinery and oil terminal in Saudi Arabia May 21, 2018. REUTERS/Ahmed Jadallah
General view of Saudi Aramco's Ras Tanura oil refinery and oil terminal in Saudi Arabia May 21, 2018. REUTERS/Ahmed Jadallah

The Joint Ministerial Monitoring Committee (JMMC), comprising Saudi Arabia, Russia, Iraq, UAE, Kuwait, Kazakhstan, Nigeria, Algeria and Venezuela holds its 65th Meeting via videoconference.

The JMMC reviewed current market conditions and emphasized the essential role of the Declaration of Cooperation (DoC) in supporting the stability of global energy markets, according to SPA.

In this context, the committee highlighted the critical importance of safeguarding international maritime routes to ensure the uninterrupted flow of energy.

It also expressed concern regarding attacks on energy infrastructure, noting that restoring damaged energy assets to full capacity is both costly and takes a long time, thereby affecting overall supply availability.

Accordingly, the committee stressed that any actions undermining energy supply security, whether through attacks on infrastructure or disruption of international maritime routes, increase market volatility and weaken the collective efforts under the DoC to support market stability for the benefit of producers, consumers, and the global economy.

In this regard, the committee commended the DoC countries that took the initiative to ensure the continued availability of supplies, particularly through the use of alternative export routes, which have contributed to reducing market volatility.

The JMMC will continue to closely monitor market conditions and retains the authority to convene additional meetings or request an OPEC and non-OPEC Ministerial Meeting, as established at the 38th ONOMM held on December 5 2024.

The next meeting of the JMMC (66th) is scheduled for June 7, 2026.

Business

Saudi Market Edges Higher on Insurance and Basic Materials Support

An investor monitors stock prices on a screen at the Saudi stock market in Riyadh (AFP)
An investor monitors stock prices on a screen at the Saudi stock market in Riyadh (AFP)
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Saudi Market Edges Higher on Insurance and Basic Materials Support

An investor monitors stock prices on a screen at the Saudi stock market in Riyadh (AFP)
An investor monitors stock prices on a screen at the Saudi stock market in Riyadh (AFP)

Saudi Arabia’s benchmark Tadawul All Share Index (TASI) edged up 0.03 percent to 11,272 points on Sunday, supported by insurance and basic materials stocks. Total traded value reached SAR 4.27 billion ($1.1 billion).

Shares of Petro Rabigh and The National Shipping Company of Saudi Arabia (Bahri) rose 1 percent and 1.5 percent to SAR 10.9 and SAR 32.6, respectively.

Saudi Arabian Amiantit Co. (Amiantit) led gainers, rising 10 percent to SAR 15.63. In the materials sector, SABIC and Maaden advanced 0.84 percent and 0.46 percent to SAR 60.05 and SAR 65.7, respectively.

In insurance, The Company for Cooperative Insurance (Tawuniya) and Bupa Arabia climbed 1 percent and 2 percent to SAR 127.3 and SAR 174.1, respectively. Almarai rose 1.2 percent to SAR 44.48 after reporting its Q1 2029 results.

On the downside, Saudi Aramco—the index heavyweight—declined 0.22 percent to SAR 27.54.

ACWA Power fell about 1 percent to SAR 168 after announcing last week a temporary curtailment of power output at two of its solar projects. Emaar The Economic City (Emaar EC) was the biggest decliner, falling 7.6 percent to SAR 10.88.