MNI China Press Digest Nov 14: New Loans, Construction, Prices

Highlights from Chinese press reports on Friday:

• The sharp decline in new loans in October is in line with seasonal patterns, and the significant year-on-year decrease was mainly due to a substantial drop in new household loans, reflecting continuous adjustment in the real-estate market and weakness in consumer spending, Beijing Business Today reported citing Wang Qing, analyst with Golden Credit Rating. Meanwhile, demand for business loans also weakened amid slowing economic momentum since Q3, Wang added, noting the rapid and frequent issuance of government bonds will temporarily squeeze out certain corporate loans. New loans increased by only CNY220 billion in October, a decrease of CNY1.07 trillion compared to the previous month and a decline of CNY280 billion compared to the same period last year, the newspaper said.
• Several provinces including Jiangsu, Guangxi and Hubei have kicked off major construction projects in Q4 to support 2025 growth, Securities Times reported. The excavator index, considered as a barometer of infrastructure construction, rebounded in October, with the sale of various types of excavators increasing by 7.77% y/y and the operating hours and utilisation rate of excavators also increasing from the previous month, the newspaper said citing data from the China Construction Machinery Association. However, the CNY500 billion additional funds from policy-based financial instruments allocated recently may manifest its supporting role in infrastructure investment in Q1 2026, considering seasonal factors, the newspaper said citing Yuan Chuang, chief economist at Chasing Securities.
• Promoting a reasonable recovery in prices requires leveraging the combined effect of macroeconomic policies and maintaining policy consistency, Shanghai Securities News reported citing analysts. Monetary policy remains supportive to create a suitable monetary and financial environment for price recovery, but its marginal efficiency has declined even with remaining policy room. It is necessary to shift the macroeconomic control approach towards boosting social welfare and consumer spending, while also focusing on building a unified national market to improve supply structure and eliminate ineffective supply, the newspaper said. China's inflation target of around 2% should be viewed as a medium- to long-term goal, the newspaper added.