How do you interpret the financial data for November?

Monetary authorities update financial data for November 1) Social financing added 2.485 trillion yuan, with a growth rate of 8.5% (unchanged from previous) 2) New RMB loans added 390 billion yuan, with a growth rate of 6.4% (previously 6.5%) 3) M2 grew by 8.0% year-on-year (previously 8.2%), M1 grew by 4.9% (previously 6.2%) Key Points Driven by credit growth in the real economy, the slowdown in social financing is slowing down In November, social financing added 2.485 trillion yuan, an increase of 159.7 billion yuan year-on-year, surpassing the average market expectations. In the five major components, credit to the real economy, government bonds, and corporate stock financing decreased year-on-year, while corporate bond financing and "non-standard" financing increased significantly year-on-year. Specifically, in that month, corporate bond financing was 416.9 billion yuan (23.81 billion yuan in the same period last year), of which industrial bond financing was 378.477 billion yuan (approximately 237.871 billion yuan in the same period last year), contributing 79% to the year-on-year growth of corporate bonds; "non-standard" financing was 214.6 billion yuan (81.8 billion yuan in the same period last year), including undiscounted acceptance bills financing of 149 billion yuan (91 billion yuan in the same period last year), trust loans of 84 billion yuan (91 billion yuan in the same period last year), and entrusted loans remained basically unchanged. In terms of year-on-year growth, credit to the real economy increased by 116.3 billion yuan year-on-year, with the decline significantly narrowing from the previous month; government bond financing decreased by 104.8 billion yuan year-on-year, mainly due to the drag from local government bonds. Overall, social financing in that month exceeded the market's average expectations, mainly due to the strength of credit to the real economy, while other projects had similar results. With structural tools support, corporate credit is showing signs of improvement In November, new RMB loans added 390 billion yuan (58 billion yuan in the same period last year), slightly outperforming seasonal expectations. In terms of structure, credit issuance continued to differ between the residential and corporate sectors. Regarding residential credit, the "weak credit" characteristics were maintained, with both total quantity and structure weakening. In that month, residential credit decreased by 206.3 billion yuan. Among them, short-term loans decreased by 215.8 billion yuan (decreased by 37 billion yuan in the same period last year), medium and long-term loans increased by 10 billion yuan (increased by 300 billion yuan in the same period last year). In terms of corporate credit, the total amount was strong but the structure was worrying. In that month, corporate credit increased by 610 billion yuan, with an increase of 360 billion yuan year-on-year, further expanding from the previous month. Among them, short-term credit was 100 billion yuan (a decrease of 10 billion yuan in the same period last year), medium and long-term loans were 170 billion yuan (210 billion yuan in the same period last year), and bill financing was 334.2 billion yuan (nearly 122.3 billion yuan in the same period last year). We have previously mentioned in our forecast report that the increase in structural tools supported credit issuance in that month. Among them, PSL's net investment was 25.4 billion yuan, which had been net withdrawals in the first 10 months of this year; other structural monetary policy tools had a net investment of 115 billion yuan, far exceeding previous levels of investment. The performance of structural tools mainly cooperates with fiscal policy to "support" the economy, but from a "supportive" perspective, "quasi-fiscal" tools led by PSL are still in the process of exiting, and it may be difficult to continue to play a role in promoting credit. Under the impact of a high base, the growth rate of M1 is declining faster In November, new RMB deposits totaled 1.4 trillion yuan, with a year-on-year decrease of 760 billion yuan. In terms of structure, residential deposits increased by 670 billion yuan, a year-on-year decrease of 120 billion yuan, non-bank financial institutions deposits increased by 80 billion yuan, a year-on-year decrease of 100 billion yuan. In that month, the stock market was hovering, with minimal changes in margin trading; wealth management increased by 39.7 billion yuan, only 10% of October's level, indicating seasonal contraction. Fiscal deposits decreased by 50 billion yuan, with an increase of 140 billion yuan compared to the same period last year, reflecting the effort in fiscal spending. Corporate deposits decreased by approximately 100 billion yuan year-on-year. In terms of broad money supply, both M1 and M2 growth rates are declining simultaneously. The growth rate of M1 decreased by 1.3 percentage points compared to the previous month, further accelerating due to the high base effect; the growth rate of M2 decreased by 0.2 percentage points compared to the previous month, with the same decline as the previous month. The marginal difference between M1 and M2 has widened, indicating a slowdown in fund activation trends. Conclusion and Implications: In November, with the support of structural tools, the slowdown in the growth rate of social financing has slowed down, but the trend has not changed, and it may decrease to around 8.4% by the end of the year. It is worth noting that there has been an important change in the requirements of monetary policy at the Central Economic Work Conference, shifting from "maintaining the growth rate of social financing and M2 in line with the nominal GDP target" to "promoting stable economic growth and reasonable price increase as important considerations for monetary policy." Combined with the previous proposal by the central bank to reform the monetary policy framework, it suggests that next year's monetary policy will accelerate the transition from quantity-based control to price-based control, and there may be changes in the intermediate target. As for the possibility of decoupling the growth rate of social financing from nominal GDP, this still requires verification from more information such as the scale of bond issuance and credit incentive measures. Risk Warning: This article is sourced from the WeChat public account "CMB Macro Insights" and written by CMB Macro analyst Zhang Jingjing; GMTEight editor: Wenwen.