The amount of money that banks in China lent out in the month of June reportedly reached around 1.27 trillion yuan ($206.18 billion). A series of incentives released by the People's Bank of China (PBOC) is believed to have helped achieve the better-than-expected figures.

The country's central bank also announced that China's supply of Yuan (M2) increased by almost 12 percent contrary to earlier predictions. according to Reuters.

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The PBOC noted that Yuan denominated debts, which are still outstanding, have increased by more than 13 percent as of June 30.

Many financial experts believed that in June, bank lending in China would increase by 14 percent from 900 billion yuan in May, to 1.05 trillion. Experts' forecast that China's yuan supply would increase by 11 percent was also lower than the actual June figure.

The country's foreign currency stockpile is still the largest compared to other countries. However, the foreign currency that China holds has dropped. From $3.73 trillion as of March 31, the reserves had decreased to $3.69 trillion by the end of June.

Liu Li-Gang, an analyst with ANZ, believes that the drop is to be expected considering that the Renminbi's value has increased compared to the U.S. dollar during the second quarter of 2015. The PBOC currently pegs one U.S. dollar to around 6 yuan, according to Yahoo News.

The Chinese central bank reduced lending rates about four times in less than a year to help achieve the economic growth target. Bank cash reserves have also been reduced in order to encourage more China bank lending activities.

Despite the increase in new loans last month, experts think that the Chinese economy would increase by less than 7 percent for the year 2015, according to Mail Online.

The increase in bank lending and improved supply of the yuan can help the country's economy improve in the last half of 2015, according to Shenyin & Wanguo economist Li Huiyong. He also thinks that the central bank will continue to provide more incentives to banks and businesses.

Lending to companies and charging them minimal interest is a strategy that the country's central bank is expected to continue to rely on to achieve the economic growth target.

TagsPeople's Bank of China (PBOC), money supply, outstanding yuan loans, foreign currency reserves, yuan, china bank lending, chinese bank loans