PREVIEW-China money, loan growth to ease further in May

* WHAT: China May money supply, loan data

* WHEN: No fixed time, but June 15 at latest

* REUTERS FORECASTS:
(M2 and loan growth are pct change y/y; new loans are bln
yuan)

NO. OF

MEDIAN RANGE April/10 May/09
FORECASTS
M2 21.0 20.0/21.9 21.5 25.7
31
New loans 600.0 450/700 774.0 665.0
29
Loan growth 21.4 21/22 22.0 30.6 18

* FACTORS TO WATCH:

Money and credit growth have gradually moderated over the
past half-year from record highs in 2009 as the government
called on banks to rein in credit to help keep the economy from
overheating.

New loans in May are expected to have continued the slowing
trend and may even surprise the market on the downside, because
the government stepped up its crackdown on property market
speculations in mid-April, which should have curbed mortgage
loans.

According to local media reports, banks extended more than
600 billion yuan in new loans in May [ID:nTOE653003].

MARKET IMPACT:

Earlier this year the market closely watched loan data to
judge the severity of Beijing’s broader policy tightening, but
in recent months the government has stabilised lending to such
an extent that investors have effectively priced in the
consensus forecast of 600 billion yuan in new credit.

Any major deviation from that would rate as a big surprise.
If loans are unexpectedly strong, the market might view that as
evidence that the central bank is pausing its gradual
tightening of monetary policy, just the kind of news that might
offer solace to a beleaguered Chinese stock market.

* For China’s April loan and credit data: [ID:nTOE64A03J]

* China indicator fixed page: (ECONCN: )

* All Chinese economic data: (CN/DATA: )

Breakdown of forecasts:

M2 New loans Loan growth
ANZ 21.3 550 ~
Bank of China 20.6 620 21.4
Bank of Communications 21.2 600 21.4
Barclays Capital 21.0 ~ ~
BNP Paribas 21.0 600 21.4
BOC International 20.0 700 21.5
Capital Economics 21.0 650 ~
CEBM 20.8 550 ~
China Merchants Bank 20.5 700 21.6
CICC 21.0 550 ~
Citi 20.6 ~ ~
CITIC Securities 20.5 560 ~
Daiwa Capital Markets 21.2 600 ~
Donghai Securities 21.2 450 21.0
Fortune Trust 21.0 550 21.2
Goldman Sachs 50.0 620 ~
Guotai Junan Securities 21.4 650 ~
Haitong Securities 21.8 480 ~
Hang Seng Bank 21.0 600 21.4
HSBC 21.1 650 21.5
IFR 20.6 ~ ~
Industrial Bank 21.3 550 21.2
Industrial Securities 20.6 500 21.0
ING 21.0 600 ~
Mizuho Securities 21.0 550 21.0
Sealand Securities 21.0 500 21.1
Shanghai Securities 20.5 500 21.1
Shenyin & Wanguo Securities 20.8 700 21.6
Sinolink Securities 21.0 700 21.0
SJS Markets 21.9 600 22.0
Standard Chartered 20.9 600 ~
UBS 20.0 580 21.3

For previews of other Chinese data next week, including
exports, CPI, industrial output and retail sales, click on
[CN-MCE-PRE-LEN].

For more stories on China’s economy (Read more about the fastest growing economy.), see
[CN-M-MCE-LEN-NEWS]

Stock Analysis

(Reporting by Beijing Economic Team; Writing by Aileen Wang;
Editing by Ken Wills & Kim Coghill)

PREVIEW-China money, loan growth to ease further in May