{"id":119615,"date":"2021-08-10T02:51:04","date_gmt":"2021-08-10T02:51:04","guid":{"rendered":"https:\/\/fin2me.com\/?p=119615"},"modified":"2021-08-10T02:51:04","modified_gmt":"2021-08-10T02:51:04","slug":"slow-growth-in-japans-bank-lending-shows-covid-19-cash-crunch-easing","status":"publish","type":"post","link":"https:\/\/fin2me.com\/markets\/slow-growth-in-japans-bank-lending-shows-covid-19-cash-crunch-easing\/","title":{"rendered":"Slow growth in Japan's bank lending shows COVID-19 cash crunch easing"},"content":{"rendered":"
TOKYO (Reuters) – Japan\u2019s bank lending rose in July at the slowest annual pace in nearly nine years, data showed on Tuesday, a sign companies were emerging steadily from a cash crunch last year caused by the coronavirus pandemic.<\/p> But the slowdown in lending also reflected sluggish consumption as households hoarded cash instead of spending, underscoring the fragile nature of Japan\u2019s economic recovery.<\/p>\n Total bank lending rose 1.0% in July from a year earlier, Bank of Japan data showed, slowing from a 1.4% gain in June and marking the lowest year-on-year increase since November 2012.<\/p>\n Bank lending surged last year when companies were in need of immediate cash to ease the impact of the coronavirus pandemic on business.<\/p>\n \u201cSome companies were paying back loans they tapped as a precaution,\u201d a BOJ official told a briefing. \u201cBank deposits remain at high levels, which shows households are cautious about boosting spending,\u201d he added.<\/p>\n The average balance of bank deposits rose 5.7% in July from a year earlier at 831 trillion yen ($7.53 trillion), far exceeding the 578 trillion yen for that of bank lending, the data showed.<\/p>\n Major banks saw lending fall 1.4% in July from a year earlier after a 1.6% drop in June, largely in reaction to last year\u2019s surge in fund demand to deal with the pandemic\u2019s shock.<\/p>\n Regional banks increased lending by 2.3% in July, a slowdown from a 2.9% gain in June, suggesting that cash constraints were easing even for small and mid-sized borrowers.<\/p>\n Japan\u2019s economy emerged from last year\u2019s hit from the pandemic thanks to robust overseas demand, though the outlook is clouded by a resurge in COVID-19 infections that is crippling private consumption.<\/p>\n ($1 = 110.3400 yen)<\/p>\n