The growth of China's money supply was accelerated in January due to the booming deposit and cash flow around the New Year holiday, the People's Bank of China (PBC), the country's central bank, said on Tuesday.

By the end of January, the broad measure of the money supply, M2, which covers cash in circulation and all deposits, grew 19.2 percent year-on-year to 30.35 trillion yuan (about US$3.772 trillion), or 4.9 percentage points higher than that of the same period in the previous year.

Statistics released by the central bank, said the newly-added renminbi-denominated deposit in Jan. amounted to 695.1 billion yuan (about US$86.4 billion), 426.8 billion yuan (about US$53 billion)more than that of the previous year.

By the end of January, said the bank, the narrow measure of the money supply, or M1, grew year-on-year 10.6 percent to 10.74 trillion yuan(about US$1.335 trillion), with the growth rate 4.7 percentage points down from the previous year.

Money in circulation went up 22.1 percent to 2.9 trillion yuan(about US$360.46 billion), said the bank.

The money supply is the intermediate goal of the current monetary policy pursued by the central bank.

M1 is an antecedent index for a country's economic performance, reflecting the change in the amount of money in the hands of residents and enterprises, while M2 shows the demand of the whole of society and indicates possible inflation.

China has set up a 15-percent target for money supply growth in 2005 to fuel its booming economy on the one hand and rein in the growth of some overheated sectors on the other.

It expects a 16-percent growth for M2 and a 14-percent growth for M1 in 2006, according to the bank.

Bank figures also indicated that the outstanding renminbi-dominated deposits rose 21.1 percent year on year by the end of January to 19.95 trillion yuan (about US$2.48 trillion).

The outstanding renminbi-dominated loans amounted to 19.95 trillion yuan (about US$2.48 trillion) in January, a rise of 13.8 percent year on year.

(Xinhua News Agency February 15, 2006)