China yanks credit handbrake

Commodity prices are a bubble and the pin is closing in fast. China released credit data for April overnight the slowdown is outpacing even my expectations. China has yanked a credit handbrake.

Total social financing came in at 1.85tr yuan within which bank credit made up 1.47tr

This is down 38.5% year on year, the second decline of such magnitude in a row:

The jackboot is back in shadow credit and the PBOC has slammed bank growth as well:

The rolling annual is going into precipitous reverse:

M2 is already a falling anvil:

And broad credit is falling faster than even I expected:

One has to suppress a wry smile watching iron ore dance around at $240.

David Llewellyn-Smith
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