Thursday, December 11, 2014

China To Increase Lending

China has told banks to issue more loans by the end of the year to lift flagging economic growth. The People's Bank of China will now permit banks to lend more than 75% of their deposits and allow banks to lend a record 10T yuan ($1.6T) for all of 2014, up from a previous target of 9.5T yuan, Reuters reports. The move comes just one day after Chinese inflation slipped to a five-year low and follows last month's surprise cut in interest rates.  

It seems that China has escaped the feared 'asset bubble' and managed their way out of potential hyper-inflation.  That is positive for the world economy.

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