POLL Chinese bank lending likely plunged in July as seasonal factors outweigh policy support
Chinese banks issued around 300 billion yuan ($41 billion) in net new yuan loans in July versus 2.24 trillion yuan in June, showed the average of 17 economist estimates in a Reuters poll.
July typically sees lower loan disbursement as it follows strong credit expansion in June when banks strive to meet quarterly targets.
Elevated government bond issuance and improved corporate bond issuance likely boosted growth of total social financing, or broad credit, to 9.1% in July year-on-year from 8.9% in June, Nomura said in a research note.
The government two weeks ago pledged to boost investment in agriculture to stabilise supply of grain and other key produce. This week, it said it would encourage banks to provide more medium- and long-term financing to advanced manufacturing industries such as those related to integrated circuits.
Manufacturing activity shrank for a fourth successive month in July, indicating that an export surge before the U.S. imposed new tariffs started to fade while domestic demand remained dull.
Easing friction with the U.S. may give China room to introduce stimulus to encourage consumption. The world's two largest economies are seeking a 90 day extension to a trade truce which would otherwise expire on August 12.
The government is due to release loans and money supply data on August 8-15.
Cash in circulation plus certain types of deposit such as corporate time deposits and household savings - known as M2 money supply - likely grew 8.2% in July from a year earlier, versus 8.3% in June, the poll showed.
Economists estimated outstanding yuan loans grew 7.0% in July from a year prior, compared with 7.1% in June.
Total social financing - a broad measure of credit and liquidity - likely fell to 1.5 trillion yuan in July from 4.2 trillion yuan in June, the poll showed. Any acceleration in government bond issuance could boost such financing.
The measure includes off-balance-sheet forms of financing beyond conventional bank lending, such as initial public offerings, bond sales and loans from trust companies.
($1 = 7.1803 Chinese yuan renminbi)
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Guardian
an hour ago
- The Guardian
Transfer roundup: Liverpool confirm Darwin Núñez's move to Al-Hilal
Darwin Núñez has completed his departure from Liverpool after his switch to Saudi Pro League side Al-Hilal was confirmed. The 26-year-old Uruguay striker has finalised the move for a fee understood to be an initial €53m (£46m). Liverpool said the deal was complete, subject to international clearance, and added: 'Everybody at the club would like to thank Darwin for his contributions and wish him and his family all the best for the future.' Núñez moved to Anfield in June 2022 from Benfica for an initial fee of £64m. He scored 40 goals in 143 appearances for the Reds, but started just eight Premier League matches during their title-winning season last term. Núñez was a target for another Saudi club, Al-Nassr, in January, but a £60m bid was rejected as Liverpool did not want to sell during the season. However, his departure looked inevitable after a string of unconvincing displays, and takes Liverpool's income from sales this summer to almost £200m, with more likely to follow as the £40m-plus-rated midfielder Harvey Elliott possibly next to move on. It also opens up a space in their forward line, which has already been strengthened with the arrival of Hugo Ekitiké as part of a near-£300m spend, and the No 9 shirt. Liverpool retain an interest in Newcastle's Alexander Isak after having a £110m bid rejected last week. West Ham have completed the £18m signing of the Leicester goalkeeper Mads Hermansen. The 25-year-old Denmark international has agreed personal terms and the Premier League club confirmed the deal shortly before their pre-season friendly against Lille on Saturday. Hermansen will be reunited with the goalkeeping coach Casper Ankergren, who worked with him at Brøndby. The Hammers let Lukasz Fabianski leave at the end of last season and have been eager to sign the player who made 72 appearances for Leicester. Elsewhere, Sunderland are poised to acquire the Getafe defender Omar Alderete in a deal reported to be worth €12m (£10.4m).
BBC News
2 hours ago
- BBC News
It shocked the US market but has China's DeepSeek changed AI?
US President Donald Trump had been in office scarcely a week when a new Chinese artificial intelligence (AI) app called DeepSeek jolted Silicon DeepSeek-R1 shot to the top of the Apple charts as the most downloaded free app in the firm said at the time its new chatbot rivalled ChatGPT. Not only that. They asserted it had cost a mere fraction to claims – and the app's sudden surge in popularity – wiped $600bn (£446bn) or 17% off the market value of chip giant Nvidia, marking the largest one-day loss for a single stock in the history of the US stock other tech stocks with exposure to AI were caught in the downdraft, also cast doubt on American AI dominance. Up until then, China had been seen as having fallen behind the US. Now, it seemed as though China had catapulted to the capitalist Marc Andreessen referred to the arrival of DeepSeek-R1 as "AI's Sputnik moment," a reference to the Soviet satellite that had kicked off the space race between the US and the USSR more than a half century earlier. Still relevant It has now been six months since DeepSeek stunned the China's breakthrough app has largely dropped out of the headlines. It's no longer the hot topic at happy hour here in San Francisco. But DeepSeek hasn't challenged certain key assumptions about AI that had been championed by American executives like Sam Altman, CEO of ChatGPT-maker OpenAI."We were on a path where bigger was considered better," according to Sid Sheth, CEO of AI chip startup maxing out on data centres, servers, chips, and the electricity to run it all wasn't the way forward after DeepSeek ostensibly not having access to the most powerful tech available at the time, Sheth told the BBC that it showed that "with smarter engineering, you actually can build a capable model".The surge of interest in DeepSeek took hold over a weekend in late January, before corporate IT personnel could move to stop employees from flocking to organisations caught on the following Monday, many scrambled to ban workers from using the app as worries set in about whether user data was potentially being shared with the People's Republic of China, where DeepSeek is while exact numbers aren't available, plenty of Americans still use DeepSeek Silicon Valley start-ups have opted to stick with DeepSeek in lieu of more expensive AI models from US firms in a bid to cut down on investor told me for cash-strapped firms, funds saved by continuing to use DeepSeek are helping to pay for critical needs such as additional headcount. They are, however, being careful. In online forums, users explain how to run DeepSeek-R1 on their own devices rather than online using DeepSeek's servers in China - a workaround they believe can protect their data from being shared surreptitiously."It's a good way to use the model without being concerned about what it's exfiltrating" to China, said Christopher Caen, CEO of Mill Pond Research. US-China rivalry DeepSeek's arrival also marked a turning point in the US-China AI rivalry, some experts say. "China was seen as playing catch-up in large language models until this point, with competitive models but always trailing the best western ones," policy analyst Wendy Chang of the Mercator Institute for China Studies told the BBC.A large language model (LLM) is a reasoning system trained to predict the next word in a given sentence or phrase. DeepSeek changed perceptions when it claimed to have achieved a leading model for a fraction of the computational resources and costs common among its American had spent $5bn (£3.7bn) in 2024 alone. By contrast, DeepSeek researchers said they had developed DeepSeek-R1 – which came out on top of OpenAI's o1 model across multiple benchmarks – for just $5.6m (£4.2m). "DeepSeek revealed the competitiveness of China's AI landscape to the world," Chang AI developers have managed to capitalize on this shift. AI-related deals and other announcements trumpeted by the Trump administration and major American tech companies are often framed as critical to staying ahead of AI czar David Sacks noted the technology would have "profound ramifications for both the economy and national security" when the administration unveiled its AI Action Plan last month."It's just very important that America continues to be the dominant power in AI," Sacks has never managed to quell concerns over the security implications of its Chinese US government has been assessing the company's links to Beijing, as first reported by Reuters in June.A senior US State Department official told the BBC they understood "DeepSeek has willingly provided, and will likely continue to provide, support to China's military and intelligence operations".DeepSeek did not respond to the BBC's request for comment but the company's privacy policy states that its servers are located in the People's Republic of China."When you access our services, your Personal Data may be processed and stored in our servers in the People's Republic of China," the policy says. "This may be a direct provision of your Personal Data to us or a transfer that we or a third-party make." A new approach? Earlier this week, OpenAI reignited talk about DeepSeek after releasing a pair of AI were the first free and open versions – meaning they can be downloaded and modified - released by the American AI giant in five years, well before ChatGPT ushered in the consumer AI era."You can draw a straight line from DeepSeek to what OpenAI announced this week," said d-Matrix's Sheth. "DeepSeek proved that smaller, more efficient models could still deliver impressive performance—and that changed the industry's mindset," Sheth told the BBC. "What we're seeing now is the next wave of that thinking: a shift toward right-sized models that are faster, cheaper, and ready to deploy at scale."But to others, for the major American players in AI, the old approach appears to be alive and days after releasing the free models, OpenAI unveiled GPT-5. In the run-up, the company said it significantly ramped up its computing capacity and AI infrastructure.A slew of announcements about new data centre clusters needed for AI has come as American tech companies have been competing for top-tier AI CEO Mark Zuckerberg has ploughed billions of dollars to fulfil his AI ambitions, and tried to lure staff from rivals with $100m pay fortunes of the tech giants seemed more tethered than ever to their commitment to AI spending, as evidenced by the series of blowout results revealed this past tech earnings shares of Nvidia, which plunged just after DeepSeek's arrival, have rebounded – touching new highs that have made it the world's most valuable company in history."The initial narrative has proven a bit of a red herring," said Mill Pond Research's are back to a future in which AI will ostensibly depend on more data centres, more chips, and more power. In other words, DeepSeek's shake-up of the status quo hasn't what about DeepSeek itself?"DeepSeek now faces challenges sustaining its momentum," said Marina Zhang, an associate professor at the University of Technology due in part to operational setbacks but also to intense competition from companies in the US and China, she notes that the company's next product, DeepSeek-R2, has reportedly been delayed. One reason? A shortage of high-end chips. Sign up for our Tech Decoded newsletter to follow the world's top tech stories and trends. Outside the UK? Sign up here.
Daily Mail
3 hours ago
- Daily Mail
Angela Rayner accused of playing 'catch-up' over new Chinese mega-embassy after being 'spooked' by national security concerns
faced claims last night that she had only raised questions over the new Chinese mega-embassy after being 'spooked' by briefings over national security concerns. The Deputy Prime Minister has demanded Beijing provides additional information after the blueprints contained blacked-out drawings. Several rooms on planning documents submitted to Tower Hamlets Council, including the basement area, have been marked 'redacted for security reasons'. A letter sent from Ms Rayner's department has given the embassy a two-week deadline to supply unredacted drawings and explain the reasons for not showing them. The move marked a change in tone for the Government over the embassy, amid fears that despite warnings of an espionage risk, Labour would agree to the plan. But a well-placed source told The Mail on Sunday that Ms Rayner has been 'spoken to' by the security services, who had flagged concerns over the application. The source claimed the advice had forced the Deputy PM to at least ask more questions over what would be the biggest embassy complex in Europe. The Royal Mint Court site, near London's financial district, has sparked fears it will include 'spy dungeons' in the heart of the City. Last week, it emerged that Ms Rayner, who is also in charge of local government and housing, had given China the two-week deadline to explain the mystery. The source said: 'There is a tribe in the Foreign Office who think we should be closer to China. They think that lots of good things would happen – diplomatically, with investment – if we were to green-light the embassy.' But the source added: 'Now other voices are saying there are a lot of reasons to be cautious, including that the Chinese are not being as open as we would like about the planning. They have spoken to her, and Rayner's been spooked.' A Government source responded by saying they could not comment on planning matters. Ms Rayner also faced claims that she was 'politicising' the issue. Shadow Housing Secretary James Cleverly said: 'Everything she does, and every decision she makes, she sees through the prism of her leadership ambitions. 'The Government rushed to try and please the Chinese Communist party, including making big announcements about this embassy. They clearly didn't ask the serious questions about its size, scale and use – and they're clearly trying to play catch-up.' In an interview to be released today, Reform deputy leader Richard Tice told the Latika Takes podcast: 'I don't think we should be accepting their new proposed embassy in the heart of the City of London.' The Chinese Embassy said last week that it took 'into full consideration' the UK's planning policy when it submitted the application.
