New loans beat forecast, as authorities ease credit

(BBC News): China's lending and money supply grew at a faster pace than expected as the country relaxed its credit restrictions.

New loans worth 640.5bn yuan ($101bn; £65.6bn) were issued in December, up from 562.2bn yuan in November.

Last month, the central bank cut the amount of money banks have to hold in reserve for the first time since 2008.

Chinese authorities are seen to be spurring domestic growth amid fears of a slowdown in the US and Europe.

China had previously been struggling to tame high inflation and therefore the central bank had been tightening monetary policy.

However, analysts said the lending figures out on Sunday show a shift in policy towards easing to encourage lending.

"The policy easing signal is becoming clearer," said Wang Hu, from Guotai Junan Securities in Shanghai. "We think the central bank will continue to loosen credit in the coming months."

SEE BBC NEWS: http://www.bbc.co.uk/news/business-16464092