2012 broad money supply targeted by economists
Updated: 2013-02-01 17:00
SHANGHAI - The fact that China's broad money supply rose to become the world's highest in 2012 has highlighted the possible malignant effects of an excess money supply, with experts divided on the implications of the situation.
A bank clerk checks bank notes in a bank in Ganyu, Jiangsu province, Aug 13, 2012. [Si Wei/Asianewsphoto]
Economist Lang Xianping referred to China as "the world's biggest printing press in 2012" in a microblog entry he posted on Sina Weibo, the Chinese equivalent of Twitter.
Although its GDP accounts for roughly 8 percent of the world's total, China's money supply in 2012 was as much as 27 percent of the world's total, Lang wrote in his post.
Lang warned that a monetary oversupply will result in severe inflation and anger the public.
Statistics from China's central bank, the People's Bank of China, show that the country's broad money supply (M2), which covers cash in circulation and all deposits, grew 13.8 percent year-on-year in 2012 to reach 97.42 trillion yuan by the end of 2012.
The growth rate, 0.2 percentage points higher than that at the end of 2011, was slightly below the government's annual target of 14 percent for 2012.