The central bank: Downplay the focus on loans as a single financing channel and combine the observation of loans and bonds financing.

The People's Bank of China has released the Report on the Implementation of China's Monetary Policy for the Second Quarter of 2026. The column suggests downplaying the focus on loans as a single financing channel and instead observing loans in conjunction with bond financing. In recent years, capital-intensive industries, such as real estate and infrastructure, have continued to adjust, while new productive forces have become lighter, leading to a corresponding decline in the need for bank loans required for economic growth per unit. Consequently, loan demand has naturally decreased. At the same time, the importance of other channels such as bonds and stocks has risen. In particular, technology firms exhibit differentiated risk-return characteristics at various stages of growth, necessitating diversified financing channelsincluding bonds and equity financingto provide funding support throughout their entire lifecycle, making the financial system more compatible with the transformation and upgrading of the industrial structure. In the first half of this year, net financing from corporate bonds and stocks reached 2.4 trillion yuan, approximately 1 trillion yuan more than the same period last year. If we combine corporate loans, corporate bonds, and stocks, there was an increase of 13.5 trillion yuan in the first half of this year, about 600 billion yuan more than the previous year.