2025-06-13-花旗集团-中国经济_信贷脉冲可能见顶_11页_218kb

Credit Market Pulse Summary

Citigroup Analysis (June 13, 2025)

Overview

• Credit Demand: Credit demand from both households and corporations remained weak despite monetary easing in May and substitution effects from government bonds.
• Credit Impulse: Credit impulse (the measure of change in total social financing (TSF)) plateaued in May after rising from November 2024, potentially facing downward pressure if fiscal stimulus effects fade and non-governmental credit demand remains stagnant.
• M1 Growth: Despite concerns over peaking credit impulse, M1 growth rebounded sharply to a one-year high (2.3% YoY), offering relief as improving corporate demand deposits could offset substitution patterns from government financing.

Key Economic Indicators

1. New Social Financing (TSF) in May 2025

   • New TSF improved slightly compared to market expectations but may peak.
   • Government bond financing was strong (RMB1,463bn in May), continuing the trend of fiscal-driven TSF boost.
   • With the 2025 fiscal quota (RMB13.9tn) nearly exhausted, government bond-driven TSF may decline in the latter half of the year.
   • Fiscal fund deployment lags, with large fiscal deposits building up (over RMB2tn deposit increase from Jan-May), potentially delaying non-governmental credit expansion.

2. Loan Growth – Below Expectations

   • Overall bank lending (RMB620bn) was low despite RRR and rate cuts, falling short of Citi/Merchant Bank forecasts.
   • Household loans growth (+RMB75bn long-term, -RMB21bn short-term) remains soft even after the 10bps rate cut.
   • Corporate borrowing remained subdued, with long-term loan growth (RMB330bn) below average, offset partially by similar short-term and bill financing total compared to prior year.

3. Debt Swap Effects

   • Corporate loans were impaired by debt swaps, where bond issuance (est. RMB3.6tn total throughout 2024) allegedly replaced loan demand.
   • Increased special local gov. bond issuance may also substitute for corporate funding channels.

4. M1 and Credit Impulse

   • A rising M1 growth (2.3% YoY, prior 1.5%) suggests stronger liquidity and potentially underestimating credit demand; if sustained by corporations, this could mitigate the risk of credit impulse declining.
   • The plateauing of credit impulse indicates a break in the prior up-cycle (since November 2024).

Policy Outlook

• Monetary Policy: Focus remains on liquidity management and structural tools; Citi expects "at least one rate cut (10bps) and 50bps RRR" in H2 2025, though these measures have already been used.
• Fiscal Policy: Fiscal acceleration through special local bonds is ongoing; the reliance on government bond financing may soon taper.

Conclusion

Total Social Financing growth is plateauing due to fiscal stimulus fading and weak non-government credit demand. Solid M1 performance (2.3% YoY) provides some buffer against a further decline in credit impulse, but structural weaknesses remain. Policy tools continue to focus on sustaining liquidity and supporting structural shifts in the economy.##