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Foreign direct investment into China increased in July, the commerce ministry reported Tuesday.

FDI grew 8.7 percent on a yearly basis to CNY 54.82 billion in July. During January to July, FDI expanded 7.3 percent on year to CNY 533.14 billion.

Data released by the People's Bank of China, on Monday, showed that Chinese banks extended CNY1.06 trillion new yuan loans in July, which was below CNY 1.66 trillion in June.

Total social financing, a broad measure of credit and liquidity in the economy, expanded 10.7 percent on year in July but slower than the 10.9 percent increase in June.

The latest slowdown in lending highlights the need for further monetary easing if policymakers are to succeed in putting a floor beneath growth, Julian Evans-Pritchard, an economist at Capital Economics, said.