In November, the overall number of social finance rose, but the decline in loans was mainly caused by the large issuance of corporate bonds and government bonds, while the loans fell, and the performance of shadow banks was still not ideal. In November, the negative growth rate of social finance was weakened, and the growth rate of social finance did not rise as expected. The decline in the scale of new loans is due to: (1) how to deal with the loans of real estate developers is still unclear; (2) under the continuous supply side reform and dual control policy, various industries are still suppressed. The decline in energy prices has slightly relieved the pressure of enterprises, but various industries are still difficult; (3) The demand side is weak, and enterprises' production enthusiasm is declining. In November 2021, bank credit continued to fall. The weak demand of the manufacturing industry, the growth of personal credit increased slightly, and the financing activities related to real estate developers are still strict, resulting in the decline of credit.
During the year, the growth rate of social finance was low. In view of the prudent operation of the central bank on money supply, the year-on-year growth rate of the stock of social financing scale was at the level of 10%, which was close to the growth rate of nominal GDP (the bottom line of 6%), lower than the growth rate of real GDP. In 2021, the year-on-year growth rate of new social finance was about 31 trillion, that is, the year-on-year growth rate of social finance stock was about 10.1%, so the annual growth rate of new social finance was about - 11.7%.
Corporate long-term loans continued to fall, and the credit environment was still slightly tight. In November 2021, the growth rate of new credit fell and resident credit rebounded, but corporate credit still fell. From the perspective of residents' credit, residents' short-term loans rebounded slightly, and the overall low level of residents' consumption was stable. In order to ensure the reasonable housing demand of consumers, the financial repression and deregulation of real estate are first reflected in the long-term loans of residents. From the perspective of enterprise credit, the central bank supports the credit of the real economy, small, medium-sized and micro enterprises and carbon reform enterprises, but the amount of credit absorbed by the real economy is limited. The real estate development loan has not been liberalized, and the capital chain of real estate developers is tight, which also affects the upstream and downstream industries of the industrial chain.
Household and corporate deposits have led to a slight stagnation in the downward trend of m2m1, and corporate credit is still declining. However, the issuance of corporate bonds has increased greatly, and the cash in the hands of enterprises has risen. M2 is still running at a low level. The slight recovery of M2 is the result of the rise of residents' and enterprises' deposits. At the same time, the purchase of bonds by financial institutions has promoted the slight upward movement of M2. The adjustment caliber of monetary operation of the Central Bank of China has been clear. It is a policy choice to broaden credit and slightly broaden monetary policy. At this stage, it is still not obvious to broaden credit and currency, which needs to be observed.
With the change of monetary policy caliber, we still look forward to greater easing. On December 7, the central bank announced that financial institutions would lower the reserve requirement by 50bp, establishing the tone of easing by the central bank. At the same time, the real estate regulation has not completely ended. The contraction of real estate credit has directly brought about the decline of overall credit. The simple opening of residents' housing loans is still not enough. From the social financing and loan data in November, it is still difficult to expand without the cooperation of the real estate industry. The meeting of the Political Bureau of the CPC Central Committee in December stressed that stability is the focus of economic work in 2022, and a stable economy needs monetary policy support. In the future, it is not ruled out that the central bank will cut reserve requirements and interest rates again.
