China’s loan growth is collapsing: China’s loans grew +4.9% YoY in August, its weakest reading in data going back to the 1990s. This comes as bank lending fell to just ~$9 billion, materially below the ~$60 billion expected. Furthermore, aggregate financing, a broad measure of credit, increased just +$247 billion, well below the +$314 billion expected. Loan growth has trended lower for years and peaked at 34.2% YoY, following the 2008 Financial Crisis. Weak borrowing from households and businesses is driving the slowdown, with household mid- and long-term loans shrinking for the 5th month this year. At the same time, comparable corporate loans fell to more than 50% below their 2023 levels. China’s economy is struggling.