Core Viewpoint - The phenomenon of "deposit migration" has re-emerged, with a significant decrease in resident deposits and a corresponding increase in non-bank institution deposits, indicating a shift in financial asset allocation [2][10][48]. Financial Data Summary - In October, the credit balance decreased by 0.1 percentage points year-on-year to 6.5%, while the social financing stock fell by 0.2 percentage points to 8.5%, and M1 decreased by 1.0 percentage point to 6.2% [1][9][46]. - Resident deposits decreased by approximately 770 billion yuan year-on-year, while non-bank institution deposits increased by the same amount, reflecting a "seesaw" relationship [2][10][48]. - M1 growth rate decline is linked to the decrease in resident deposits, which is directly related to the contraction in resident credit [2][10][13]. Loan Structure Analysis - In October, corporate loans remained predominantly short-term, with short-term loans and bill financing increasing by 0.6 percentage points year-on-year to 10.0%, while medium to long-term loans decreased by 0.1 percentage points to 7.7% [3][19][48]. - Despite a recovery in the Producer Price Index (PPI) for three consecutive months, corporate investment sentiment remains cautious, as indicated by a decline in the PMI business expectations index [3][19][48]. Social Financing Trends - The growth rate of social financing stock has further declined, primarily due to a decrease in net government bond financing following the end of front-loaded fiscal financing [3][23][48]. - In October, net government bond financing decreased by 560.2 billion yuan year-on-year, which was a core factor in the slowdown of social financing growth [3][23][48]. Future Outlook - The stability of social financing is expected to improve with the implementation of two fiscal policies, including the full deployment of 500 billion yuan in new policy financial tools and the issuance of 500 billion yuan in local government bond limits [4][49][26]. - These policies aim to stabilize economic operations towards the end of the year and align with the government bond issuance at the beginning of 2026, creating favorable conditions for economic growth [4][49][26]. Regular Monitoring - In October, new credit amounted to 220 billion yuan, a year-on-year decrease of 280 billion yuan, primarily from the resident sector [5][50]. - The total social financing added in October was 815 billion yuan, a year-on-year decrease of 597 billion yuan, driven by declines in government bonds and RMB loans [5][32][50]. - M2 decreased by 0.2 percentage points year-on-year to 8.2%, while the new M1 decreased by 1 percentage point to 6.2%, with significant changes in deposit structures [5][38][50].

Group 1: Financial Data Overview - In October 2025, the credit balance decreased by 0.1 percentage points year-on-year to 6.5%[1] - The total social financing stock fell by 0.2 percentage points year-on-year to 8.5%[1] - M1 decreased by 1.0 percentage points year-on-year to 6.2%[1] Group 2: Deposit Migration Phenomenon - The "deposit migration" phenomenon re-emerged in October, with household deposits decreasing by approximately 770 billion RMB[2] - Non-bank institution deposits increased by about 770 billion RMB, showing a "seesaw" relationship with household deposits[2] - The decline in household deposits may lead to further adjustments in financial asset allocation, impacting bank liability structures[2] Group 3: Loan Trends - In October, corporate loans remained primarily short-term, with short-term loans and bill financing increasing by 0.6 percentage points year-on-year to 10.0%[3] - The year-on-year growth rate of medium- and long-term corporate loans decreased by 0.1 percentage points to 7.7%[3] - Despite a recovery in PPI to -2.1%, corporate investment attitudes remain cautious, as indicated by a drop in the PMI production expectation index from 54.1 to 52.8[3] Group 4: Social Financing and Government Debt - The decline in social financing growth is primarily due to a decrease in net government bond financing, which fell by 560.2 billion RMB year-on-year[4] - The issuance of 500 billion RMB in local government bonds is expected to provide direct support to social financing in November and December[4] - Two fiscal policies are anticipated to stabilize social financing, aiding economic performance towards the end of the year[4] Group 5: Credit and Monetary Aggregates - In October, new credit amounted to 220 billion RMB, a year-on-year decrease of 280 billion RMB, mainly from the household sector[5] - New social financing totaled 815 billion RMB, down 597 billion RMB year-on-year, driven by declines in government bonds and RMB loans[5] - M2 growth fell by 0.2 percentage points to 8.2%, while new M1 decreased by 1 percentage point to 6.2%[5]

Core Viewpoints - The improvement in M1 may be partially attributed to accelerated fiscal spending, with a notable increase in enterprise deposits and a decrease in fiscal deposits [2][8][20] - Resident loans remain weak, with limited effects from consumer loan interest subsidy policies, reflecting a cautious attitude towards debt among households [2][11][20] - The decline in social financing growth is linked to the end of "front-loaded" fiscal financing, particularly government bond net financing [3][16][20] Financial Data Summary - In September, the total credit balance decreased by 0.2% year-on-year to 6.6%, while social financing stock fell by 0.1% to 8.7%. M1 increased by 1.2% to 7.2% [1][7] - New credit in September was 12,900 billion, down 3,000 billion year-on-year, primarily due to the corporate sector [20][25] - M2 growth declined by 0.4% to 8.4%, with M1 showing an increase of 1.2% [28] Loan Structure Analysis - In September, new resident loans amounted to 3,890 billion, a decrease of 1,110 billion year-on-year, while corporate loans totaled 12,200 billion, down 2,700 billion [20][25] - The structure of loans indicates a preference for short-term financing among enterprises, despite improvements in PPI and PMI indices [14][20] Future Outlook - The collaboration of fiscal and monetary policies may provide marginal support for the stability of social financing operations, with the introduction of new policy financial tools aimed at leveraging more credit and social capital [3][18]