China’s total social financing hits record 4.64 trn yuan

China’s total social financing (TSF), a broad measure of credit and liquidity in the economy, hit a record 4.64 trillion yuan (685.01 billion dollars) in January, far more than expected, data from the central bank showed on Friday.
Analysts polled by Reuters had predicted the gauge would rise to 3.25 trillion yuan from 1.59 trillion yuan in December.
The rise in financing levels should allay some of the anxiety about weakening credit growth as China’s economy slows.
TSF includes off-balance sheet forms of financing that exist outside the conventional bank lending system, such as initial public offerings, loans from trust companies and bond sales.
The People’s Bank of China has revised the way it calculates TSF by adding financial institutions’ asset-backed securities and loan write-offs.
It has also added local government special bonds issuance into the TSF calculation from September.
TSF is used as a barometer of fundraising trends and can provide some clues on activity in China’s vast and unregulated shadow banking sector.
Chinese authorities have been trying to clamp down on riskier forms of lending as part of a broader campaign to reduce systemic financial risks, but the moves have triggered a marked slowdown in investment that helped drag down economic growth last year to a 28-year low. (1 = 6.7736 dollar Chinese yuan renminbi).