China's loan growth hit a three-decade low at 4.9% YoY in August, driven by collapsing household and corporate borrowing.
Macro & Markets ·
China's loan growth reached 4.9% year-over-year in August, marking the weakest pace in available data since the 1990s, as bank lending fell to approximately $9 billion against expectations of around $60 billion. Aggregate financing increased just $247 billion, materially undershooting the projected $314 billion, while household mid- and long-term loans contracted for a fifth consecutive month and corporate loans dropped more than 50% below 2023 levels. Loan growth has declined progressively over recent years from a peak of 34.2% year-over-year following the 2008 Financial Crisis, driven primarily by weakened borrowing from households and businesses.