"First Financial Daily", informed sources revealed that in 2012 the

"First Financial Daily", informed sources revealed that in 2012 the broad money supply M2 growth target is set at 14%. This goal is higher than the 13.6 percent of M2 growth in 2011 as a whole. In early 2011 to determine the M2 growth target of 16%.

The broad money supply growth in 2011 below the beginning of the target, but the total 7.5 trillion yuan of credit growth is in line with expectations, the main reason the M2 growth, low growth from September, foreign exchange, negative growth. This has changed the Chinese money supply growth will continue to influence the 2012 M2 growth. a policy department of the newspaper pointed out.

He emphasized that the size of China's M2 base, if the foreign exchange to continue the current pattern of weak growth, 2012 growth of 14% and even some difficulties. 2012 foreign exchange level of growth is expected to reduce from 3 trillion yuan in 2011 to 1.5 trillion yuan, 14 percent of M2 growth, means that the need to increase the credit of 10.8 trillion yuan, this increase is difficult to achieve. Credit pushed the M2 will be like in 2009, the overall improvement of the debt ratio of China's economic leverage level.

Foreign exchange low growth put pressure on M2 growth

China's M2 growth mainly by foreign exchange incremental and new loans. This pattern in 2001, China's accession to the WTO, especially after the appreciation of the renminbi is expected to start in 2003. By 2008, the foreign exchange contribution to growth in M2 growth remained at around 50%. Total scale, in 2004, 2005 foreign exchange of nearly two trillion yuan in 2006, 2007, 2010, 2011 an annual average of about 3 trillion yuan, the highest in 2008 to 4 trillion yuan in 2009 also close to 2.5 trillion yuan.

The first 11 months of 2011, foreign exchange accumulated increase of 2.88 trillion yuan in October, November cumulative negative growth of 52.8 billion yuan. Even the positive growth in December 2011 the total will be about 3 trillion yuan.

Chenxu Min, head of bond trading sales, innovation and business, told reporters that the foreign exchange in recent months, the weak growth is due to the global economic slowdown, the U.S. dollar appreciation caused by capital back, but also because of the foreign concerns of a slowdown in China. In 2012, this pattern may also be maintained, which means that, even if the foreign exchange return to positive growth, the growth rate will not be great. 2012 is expected to the size of the overall foreign exchange growth of about 1.5 trillion yuan.

CICC chief economist Peng Wensheng, also pointed out that the expected future foreign exchange incremental, even from negative to positive will also be at low levels. Expected 2012 trade surplus, FDI inflows will be reduced, further taking into account the slowdown of 2012 of RMB against the U.S. dollar and full year capital net inflow dropped significantly, the estimated 2012 annual foreign exchange incremental 1.5 trillion yuan so much lower than the increment of 2.9 trillion HP Compaq Keyboard in November 2011.

M2 growth target of 14%, need the M2 increment to reach 12.35 trillion yuan, if the foreign exchange grew by only 1.5 trillion yuan, means that at least the credit growth of 10.8 trillion yuan. It is difficult to achieve, the current market expectations in 2012 credit growth of about 8 trillion to 8.5 trillion yuan.

In other words, if the 2012 foreign exchange increased by 1.5 trillion yuan, credit growth to 8.5 trillion yuan, converted the 2012 M2 growth rate was only 11.8%, well below the 14% target.

M2 growth patterns push debt ratio

The problem lies in the foreign exchange to achieve the M2 growth, the private sector through the asset side to achieve the M2 growth; credit to achieve the M2 growth, the private sector through the liability side to achieve the M2 growth. M2 growth Macbook Accessories pattern, the overall improvement of China's debt ratio, the leverage level.

Wensheng Peng pointed out that in the case of M2 growth mode transition, it is expected that the 2012 M2 growth will mainly depend on new loans to promote, which is similar to the situation in 2009, its macroeconomic consequences depend on the specific implementation of monetary policy. A foreseeable consequence of the real economy will be faced with the leverage ratio to rise again.

Wensheng Peng stressed that the M2 growth, driven from the foreign exchange into the credit-fueled M2 growth will lead to different private sector leverage. 2009 credit to expand substantially in 2010, the entire economy, especially the corporate sector leverage has significantly more cautious policy of the new round of credit expansion may therefore promote the expansion of M2 growth of credit can be achieved, need to pay close attention to.

The aforementioned policy departments who also told reporters that the low growth of foreign exchange, will in turn lead to low growth in deposits. Low growth in deposits, due to loan ratio limitations, in turn, weaken the credit capacity of the banking system, thereby weakening the level of M2 growth.

"If you want to complete the 2012 M2 growth target of 14% loan-to-deposit ratio of macro-prudential indicators are also facing the fine-tuning the pressure." Wensheng Peng pointed out. In the first half of 2009, in order to tie was loose monetary policy, the CBRC had conditions relaxation of small and medium banks to loan to deposit ratio. Thus, if you need 2012 loan to deposit ratio may reproduce the 2009 short relaxation or other forms of fine-tuning.

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