China's Aggregate Financing to Real Economy Grows 8.2 Percent

Outstanding aggregate financing to the real economy (AFRE) in China reached RMB451.4 trillion at end-February 2026, marking an 8.2 percent year-on-year increase.

This growth was primarily driven by a 6.1 percent rise in outstanding RMB loans to the real economy, which totaled RMB274.15 trillion and constituted 60.7 percent of the total AFRE.

Government bonds also saw significant expansion, increasing 16.6 percent year on year to RMB97.3 trillion, representing 21.6 percent of AFRE.

Other components like corporate bonds grew 6.2 percent to RMB34.84 trillion, while foreign currency-denominated loans decreased 11 percent.

In terms of flow, AFRE increased by RMB9.6 trillion in the first two months of 2026, a rise of RMB316.2 billion compared to the same period in 2025.

RMB loans to the real economy contributed RMB5.75 trillion to this flow, although this was RMB124.8 billion less than the increase in the prior year.

Broad money supply (M2) expanded by 9 percent year on year to RMB349.22 trillion at end-February, with narrow money supply (M1) growing 5.9 percent.

Currency in circulation (M0) increased 14.1 percent.

Total RMB deposits reached RMB337.94 trillion, up 8.7 percent year on year, increasing by RMB9.26 trillion in the first two months.

Household deposits rose significantly by RMB5.24 trillion, contrasting with a RMB44.5 billion decrease in non-financial enterprise deposits.

Outstanding RMB loans grew 6 percent year on year to RMB277.52 trillion.

New RMB loans in the first two months totaled RMB5.61 trillion, primarily driven by a RMB5.94 trillion increase in enterprise loans, which offset a RMB194.2 billion decrease in household loans.