China's new yuan loans pick up in Q1

BEIJING - China's yuan-denominated lending reached 3.68 trillion yuan ($601.3 billion) in the first quarter, official data showed on Tuesday.

The volume increased by 602 billion yuan from the same period last year, said the People's Bank of China in an online statement.

March saw a total 1.18 trillion yuan ($193 billion) lent, down 66.1 billion yuan from the same period last year.

M2, a broad measure of money supply that covers cash in circulation and all deposits, increased 11.6 percent year on year to 127 trillion yuan at the end of March, the central bank said.

The narrow measure of money supply (M1), which covers cash in circulation plus demand deposits, expanded 2.9 percent year on year to 33.7 trillion yuan as of the end of last month.

China's total social financing aggregate, a broad measure of liquidity in the economy, stood at 4.61 trillion yuan in the first quarter, down 895 billion yuan from the same period last year.

The first quarter not only saw faster growth in new yuan loans, but also an improved credit structure, with more loans to infrastructure, industry, property, services, as well as small and medium enterprises, said Sheng Songcheng, director of the central bank's surveys and statistics department.

The data come amid deflationary pressure.

Growth data for the first quarter are scheduled to be released on Wednesday, and the market consensus is that the expansion may slip below 7 percent. Expectations are high for further monetary easing.

China's consumer price index (CPI), the main gauge of inflation, grew 1.4 percent year on year in March, the National Bureau of Statistics (NBS) said. The reading remained the same as that in February, which jumped back from January's 5-year low of 0.8 percent.

To support the economy, which registered 7.4 percent growth in 2014, a 24-year low, the central bank has cut benchmark interest rates twice and banks' reserve requirement ratios once since November.