China’s monetary policies have significantly bolstered the real economy in the first half of 2023, according to data released by the People’s Bank of China (PBOC) on Monday.
By the end of June, the total social financing scale—a broad measure of financing to the real economy—reached 430.22 trillion yuan ($61.46 trillion), marking an 8.9% year-on-year increase. RMB loans to the real economy stood at 265.22 trillion yuan, up 7% from the previous year.
In the first six months, new yuan-denominated loans totaled 12.92 trillion yuan. Loans to enterprises surged by 11.57 trillion yuan, accounting for 89.5% of total new loans—a 6.6 percentage point rise compared to the same period last year. These funds were chiefly directed toward key sectors like manufacturing and infrastructure, providing a steady financial lifeline to industries driving growth.
“The financial sector has continuously provided stable funding sources for the real economy,” said Yan Xiandong, director of the Statistics and Analysis Department at the PBOC. “Monetary policy has had a noticeable effect in supporting economic activity during this period.”
Interest rates on new corporate loans have also seen a decline. From January to June, the weighted average interest rate was approximately 3.3%, about 45 basis points lower than the same period last year. This downward trend in borrowing costs indicates a more favorable financing environment for businesses across the Chinese mainland.
“The financial data for the first half of the year shows that the policies proposed by the central bank have been fully implemented,” said Zou Lan, deputy governor of the PBOC, during a press conference. “These policies have played a positive role in boosting market confidence and stabilizing expectations, creating a conducive monetary and financial environment for economic recovery.”
Looking ahead, Zou emphasized the PBOC’s commitment to maintaining a moderately loose monetary policy. “We will ensure the effective implementation of all monetary policy measures and enhance the quality and efficiency of financial services for the real economy,” he stated. The central bank plans to improve the monetary policy framework by establishing a market-oriented interest rate regulation mechanism, aiming to better serve high-quality development goals.
