China Credit Growth Slows Again

M2 growth slowed to 8.1 perecnt as M2 declined in April. While three-month M2 is higher than in 2019, it is below the 2020 level. The multi-year slowdown in credit growth continues. Credit growth bottomed at 8.0 perceent in 2018, to put the number in perspective. Chinese forex reserves are stable, but assuming dedollarization, that indicates reserves are only stale. Reserves as measued in SDRs confirm this. This indicates either somoething has changed with the growth story in China or this moment is indeed transitory, with dollar pressure resuming as soon as (if) the greenback bottoms.