Chinese credit accelerates again

The new debt impulse in China continued in May with total social financing at 1.4tr yuan and banks at 1.18tr:

Shadow credit remains muted:

New loans have accelerated sharply through the first five months of 2019:

However, they are somewhat flattered by the base effect given last year’s deleveraging hit particularly hard mid-year. Thus, M2 is only stable at 8.5%:

The rolling annual is up and away:

But broad credit growth is not tearaway:

Or, via Pantheon:

There’s enough juice here so far to keep things roughly stable in H2 but not much more.

Houses and Holes

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the fouding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal.

He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.

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