China Credit Growth Misses Forecasts, Demand Sags

China’s new yuan lending rebounded to 60 billion yuan in August from a record 340 billion-yuan contraction in July, but fell far short of economists’ forecasts. The weak result reflected subdued borrowing by households and businesses, as a prolonged property downturn, sluggish income growth and uncertain economic prospects weighed on demand. Total social financing, a broader measure that includes government bonds and other nonbank channels, rose to 1.66 trillion yuan in August, illustrating how state financing is offsetting some of the weakness in private-sector credit. New yuan lending during the first eight months fell sharply from a year earlier, while outstanding loan growth slowed to a record low. The data are likely to increase pressure on Beijing to support consumption, investment and private borrowing despite recent interest-rate, reserve-requirement and fiscal measures.