New Loans Hit Three-Year Low, Impeding Increase in Base Metals-Shanghai Metals Market

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New Loans Hit Three-Year Low, Impeding Increase in Base Metals

SMM Insight 01:37:48AM Jan 12, 2013 Source:SMM

SHANGHAI, Jan. 11 (SMM) – According to the People’s Bank of China, China's new yuan-denominated lending was RMB 8.2 trillion in 2012, up nearly 10% from last year’s RMB 7.47 trillion, with the growth in December at only RMB 454.3 billion, the lowest level in three years. This was reflected in the persistently high spot discounts of #1 copper price.

As of the end of December, M2 only grew 13.8%, below government’s annual target of 14%.

Market liquidity remained lax throughout 2012 but manufacturing sector underperformed, causing shortfalls in enterprise loans. Nonferrous metals industry also witnessed poor orders and falling prices, leaving massive losses among enterprises.

With respect to China’s monetary policy in 2013, expanding social financing and new lending properly is stressed at the Central Economic Work Conference. The central government will keep the current monetary and fiscal policies largely unchanged.

The emphasis on urbanization spurred infrastructure investment projects. That, combined with the easing liquidity, is expected to help promote commodities prices. However, the actual demand remains a determinant factor affecting nonferrous metals prices.
 

New Loans Hit Three-Year Low, Impeding Increase in Base Metals

SMM Insight 01:37:48AM Jan 12, 2013 Source:SMM

SHANGHAI, Jan. 11 (SMM) – According to the People’s Bank of China, China's new yuan-denominated lending was RMB 8.2 trillion in 2012, up nearly 10% from last year’s RMB 7.47 trillion, with the growth in December at only RMB 454.3 billion, the lowest level in three years. This was reflected in the persistently high spot discounts of #1 copper price.

As of the end of December, M2 only grew 13.8%, below government’s annual target of 14%.

Market liquidity remained lax throughout 2012 but manufacturing sector underperformed, causing shortfalls in enterprise loans. Nonferrous metals industry also witnessed poor orders and falling prices, leaving massive losses among enterprises.

With respect to China’s monetary policy in 2013, expanding social financing and new lending properly is stressed at the Central Economic Work Conference. The central government will keep the current monetary and fiscal policies largely unchanged.

The emphasis on urbanization spurred infrastructure investment projects. That, combined with the easing liquidity, is expected to help promote commodities prices. However, the actual demand remains a determinant factor affecting nonferrous metals prices.