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No shift of monetary stance

January’s surge in bank lending in China does not signal any change in policy stance. Bank lending is always strong in January. Looked at in y/y terms, last month’s increase in loan growth was barely perceptible. In fact, loan growth has been flat since mid-2013. All of the credit slowdown of recent months has taken place in the shadow banking system. The key message of last month’s data was that total outstanding credit continues to slow.

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