New loans in 2011 are expected to reach 6-7 trillion yuan (US$904 billion-US$1.05 trillion), lower than the market's estimate 7.5 trillion yuan (US$1.13 trillion) for 2010, Jing Ulrich (Li Jing), managing director of JPMorgan's China equities and commodities business said Thursday.

"The latest data reveals new loans in October reached 587.7 billion yuan, 30 percent higher than the market estimate of 450 billion yuan. Since new loans in the first 10 months totaled 6.87 trillion yuan, they will try to keep the figures for November and December under 400 billion yuan. But we forecast the figure will still exceed 7.5 trillion yuan," Ulrich said.

In the last few weeks, the central bank has withdrawn 470 billion yuan (US$10.67 billion) from circulation through open market operations, and raised the deposit reserve ratio. The deposit reserve ratio of the four largest Chinese banks has been temporarily increased to 18.5 percent, but will drop back to 17.5 percent in February next year, Ulrich added.

China's business press carried the story above on Friday. China.org.cn has not checked the stories and does not vouch for their accuracy.