SteelOrbis Shanghai
The latest announcement issued by the People's Bank of
China (Central Bank) indicated that,
China's M2 (current accounts and deposit accounts) continued to increase and M1 (current accounts) growth continued to accelerate in July.
Meanwhile, RMB loans increased. The personal deposit growth declined and corporate deposit growth increased. With the brisk inter-banks RMB trade evidently increased the interest level; adding more to the flexibility of RMB exchange rate.
By the end of July, M2 reached RMB 32.4 trillion ($4.07 trillion), up 18.4 percent year on year and same as the previous month. The year on year increase is 2.1 percentage points higher than that of July 2005. M1 reached RMB 11.27 trillion ($1.41 trillion), up 15.3 percent year on year, and 1.4 percent month month. The growth rate is 4.3 percentage points higher than that of July 2005.
RMB loans totaled RMB 21.69 trillion ($2.72 trillion), up 16.3 percent year on year and 1.1 percent month on month.
The weighted average interest rates of inter-banks lending and collateral bonds repurchase in July are 2.31 percent and 2.18 percent respectively, up 0.23 and 0.31 percentage points month on month, and up 0.59 and 0.64 percentage points compared with the end of the previous year.
The average RMB exchange rate versus $1 in the end of July is RMB 7.9732, down 0.224 compared with the end of June.
The increase in loans will lead to an increase in
investments, which may influence steel
consumption positively.