(Xinhua)
Updated: 2008-05-13 23:00

BEIJING  -- China's broad measure of money supply, M2, which covers cash in circulation plus all deposits, reached 42.92 trillion yuan (6.13 trillion US dollars) in April, up 16.94 percent from a year earlier, the People's Bank of China said on Tuesday.

The increase was 0.65 percentage points higher than the figure in March, the central bank said in a statement.

The narrow measure of money supply, M1, rose 19.05 percent to 15.17 trillion yuan, 0.8 percentage points higher than March.

Meanwhile, new bank loans hit 463.9 billion yuan, up 41.9 billion yuan over a year earlier, but in March the figure was 158.3 billion yuan less than last March.

That raised the total Renminbi-denominated loans to 27.96 trillion yuan by the end of April, up 14.7 percent from the same period last year.

"The statistics indicated that the Chinese economy is still challenged by excess liquidity and a rebound in credit growth," said Fan Fangzhi, an economist with the Chinese Academy of Social Sciences.

Tight monetary policy would still be the choice as the government strived to rein in liquidity amid fears that it could lead to overheating of the economy, economists said.

Outstanding RMB deposits among the country's financial institutions in April rose 17.69 percent from April last year to 42.22 trillion yuan. The growth rate was 0.34 percentage points higher than last month.