Broad money (M2) grew 25.95 per cent in China at end-April 2009

Monetary aggregate M2 increased by 25.95 per cent year-on-year in April 2009, up 0.45 percentage points from March 2009. The high growth rates  of money supply so far in 2009 (average of  22.8 per cent growth over the last four months) show the efforts of the policies to stimulate the economy in the wake of the financial and economic crisis. Rightly so as deflation is a real threat in the short-term.

Broad money (M2) grew 25.5 per cent in China at end-March 2009

Monetary aggregate M2 increased by 25.5 per cent year-on-year in March 2009, up another 4.7 percentage points from February 2009 and 6.7 percentage points from January 2009. While the high growth rates show the effectiveness of the policies of the last months, the Monetary Policy Committe meeting of the first quarter 2009 also reaffirmed this stance for the immediate future. Rightly so as China’s economy is on the edge of deflation in the short-run.

Broad money (M2) grew 20.8 per cent in China at end-February 2009

The monetary aggregate M2 increased by 20.8 per cent year-on-year in February 2009. This rate is up 2 percentage points from January 2009, and a total of 3 percentage points from December 2008. The relatively high growth rates in the last months confirm the authorities’ efforts to implement  expansionary monetary (and fiscal) policies to fight the global financial and economic crisis in China. In the present situation – the February inflation rate was down to -1.6 per cent – the jump in monetary growth does not imply any dangers in the short-term. On the contrary, China’s economy is on the edge of deflation.

Broad money (M2) grew 18.8 per cent in China at end-January 2009

Monetary aggregate M2 increased by 18.8 per cent year-on-year in January 2009, up 1 percentage point from December 2009. The rather high rates of increase in December 2008 and January 2009 reflect the authorities’ efforts to implement more expansive monetary (and fiscal) policies to fight the present financial and economic crisis. In the present situation, the jump in monetary growth over the last two months does not imply inflationary pressures in the short-term. In fact, China’s inflation rate in January was a mere 1 per cent; the economy is thus on the edge of deflation.

Broad money (M2) grew 17.8 per cent in China at end-December 2008

Monetary aggregate M2 increased by 17.8 per cent year-on-year in December 2008, up 3 percentage points from November 2008. While in October and November monetary growth grew by modest 15 per cent, rates that reflected the overall easing of inflationary pressures in China, the jump in December clearly is the result of the authorities’ efforts to implement more expansive monetary (and fiscal) policies to fight the present financial and economic crisis. China’s rapidly declining inflation rates in the past months driven by lower commodity prices and dramatic cuts in exports show that the recent jump in monetary growth does not imply inflationary pressures in the short-term.

Broad money (M2) grew 14.8 per cent in China at end-November 2008

Monetary aggregate M2 increased by 14.8 per cent year-on-year in November 2008, slightly down again from the previous month. Since October, monetary growth reflects the overall easing of inflationary pressures in China with M2 growth rates of around 15 per cent. As such China is well-positioned to fight the impact of the financial crisis through supporting economic growth with fiscal policy measures and a less tight monetary policy stance.

Broad money (M2) grew 15.02 per cent in China at end-October 2008

Monetary aggregate M2 increased by 15.02 per cent year-on-year in October 2008, down again from the previous month. Since monetary growth reflects the overall easing of inflationary pressure, China is now well-positioned to fight the impact of the financial crisis through supporting economic growth with fiscal policy measures.

Broad money (M2) grew 15.29 per cent in China at end-September 2008

Monetary aggregate M2 increased by 15.29 per cent year-on-year in September 2008, down 0.71 percentage points compared to August and significantly lower than during the summer where in June the rate of increase reached 17.37 per cent. Monetary growth reflects therefore the overall easing of inflationary pressure. In the meantime, China’s main concern in the ongoing financial crisis likely lies at how to sustain economic growth.

Broad money (M2) grew 16.00 per cent in China at end-August 2008

The broad monetary aggregate M2 increased by 16.00 per cent year-on-year in August 2008, down 0.35 percentage points compared to July and significantly lower than in June where the rate of increase reached 17.37 per cent. Monetary growth is thus down to more sustainable levels (comparable to earlier years: 16.9 per cent in 2006,and 16.7 per cent in 2007), which suggests the inflationary threat to ease further if this trend continues.

Broad money (M2) grew 16.35 per cent in China at end-July 2008

The broad monetary aggregate M2 increased by 16.35 per cent year-on-year in July 2008, down 1.02 percentage points compared to June. The rate is down now at the levels of the recent past (16.9 per cent in 2006,and 16.7 per cent in 2007), which suggests the inflationary threat to slowly easing when this trend continues.