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China to keep new loan target unchanged: report (Reuters)

We have all read hot news written by talented authors. This showdown China to keep new loan target unchanged: report
(Reuters)
was a long time a coming. But it doesn’t stop here. The writer shows two wonderful talents. Read the the rest sections to see what I mean.

BEIJING (Reuters) – China will probably target about 7.5 trillion yuan ($1.1 trillion) in new loans next year, level with its 2010 target, a leading official newspaper reported on Tuesday, an indication that policy could be slightly looser than expected.

Control of credit issuance is one of the most important monetary policy tools in China and many in the market had assumed that Beijing would lower the new lending objective next year as a way of tamping down on inflationary pressures.

But the report on the front page of the China Securities Journal, citing an unnamed source described as authoritative, suggested otherwise.

“The Chinese economy is very big now and a target of 7.5 trillion yuan in new loans will not trigger all-round inflation,” the newspaper quoted the source as saying.

A Reuters poll of 26 economists on Monday forecast that Beijing would aim for 7 trillion yuan in new lending next year.

Chinese leaders gave greater prominence to the fight against inflation in their statement on Sunday at the end of the Central Economic Work Conference, an annual meeting at which they chart policy for the coming year.

But at the same time as vowing to focus on price stability, they also said that they will strike a balance between controlling inflation and maintaining growth.

In its report, the China Securities Journal said the focus would change over the course of the year, with the battle against inflation likely to top the agenda in the first half but supporting growth to remain the overriding objective.

“China’s inflation will probably be higher in the first half of next year and then ease in the second half. It may peak in the second quarter. So policies in the next three to six months will mainly to curb inflation,” it said.

“But inflation next year will not be as high as expected. So monetary policy will favor quantitative measures. China will be very cautious in raising interest rates. It will only raise interest rates when inflation deteriorates,” it added.

The report also said the government would likely aim for 16 percent in the wider M2 measure of money growth, which would mark a slowdown from this year’s roughly 20 percent pace.

It added that China’s five biggest lenders were aiming to maintain new lending at unchanged levels next year from this year, while smaller banks we’re talking about an expansion.

It, China to keep new loan target unchanged: report
(Reuters)
excerpt from US Economy

Short URL: http://www.usnews9.com/?p=4057

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