BEIJING - CHINA'S broad measure of money supply increased by 18.8 per cent year-on-year at the end of January as banks extended a record amount of loans, official data showed on Thursday.

The January figure for M2, the broadest measure for the nation's money supply, was up from 17.8 per cent in December, the central bank said.

The narrow measure of money supply, M1, was up by 6.7 per cent at the end of January from a year earlier, against 9.1 per cent at the end of December, according to the central bank.

M2 covers cash in circulation plus all deposits, while M1 covers cash in circulation and corporate demand deposits.

Chinese banks extended a record 1.6 trillion yuan in loans (S$353 billion) in January, according to the central bank, partly as a four-trillion-yuan stimulus plan, announced in November, began to kick in.

China had said it wants to increase the M2 money supply by 17 per cent in 2009 as part of measures to keep the world's third-largest economy ticking over in the face of the global slowdown. -- AFP