M2, the broad measure of money supply, grew 16.3 percent year-on-year by the end of July, the People's Bank of China (PBoC) announced in Beijing Friday.

The increase was "suitable" for China's economic growth, the PBoC, or the central bank, said in a report.

M1, or the narrow measure of money supply, rose by 11 percent. Money in circulation went up 9.1 percent.

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

By the end of July, the outstanding yuan-denominated loans stood at 18.6 trillion yuan (2.25 trillion US dollars) at all financial institutions, up 13.1 percent on a yearly basis.

The growth was 2.4 percentage points lower than a year ago, and 0.2 percentage points lower than a month ago, the central bank reported.

The outstanding yuan deposits rose by 17.6 percent to 27.1 trillion yuan (3.35 trillion dollars) by the end of last month, it said.

Source: Xinhua