China sees rise in new loans

China’s banks extended more loans than expected last month, but analysts warned of the risk of rising financing costs, the South China Morning Post reports. 1.54 trillion yuan ($227bn) in new loans was issued last month, up from 1.11 trillion yuan in May. Of the June figure, 483 billion yuan was for home mortgages, reflecting continuing property sales despite efforts by more than 50 cities to keep a lid on home price growth. Total social financing, which measures the overall credit and liquidity level in the economy, also beat expectations to rise by 1.78 trillion yuan in June, up from a 1.06 trillion yuan increase in May. Capital Economics China economist Julians Evans-Pritchard said the pick-up was likely seasonal, as banks often rushed to lend more to meet their targets at the end of second quarter. “We expect the monetary tightening that has already taken place to continue weighing on credit growth from some time,” he said.