The People’s Bank of China on Sunday said it would “strictly control” credit to some sectors of the economy following a surge in bank lending in March, the Financial Times reported. The central bank said in a statement following a routine quarterly meeting that it would control lending to “high polluting, high-energy consuming industries and to those with overcapacity” while favoring the agricultural sector and small- and medium-sized enterprises. The bank’s statement followed the Saturday release of money supply data which showed that M2, a broad measurement of money supply, had grown to a record 25.5% last month on the back of a record month of lending by Chinese banks. Banks extended US$278 billion in loans last month, which means that bank lending is already approaching the government’s full-year target of US$731.6 billion after the first quarter.
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