China's new yuan-denominated lending in October hit 548.3 billion yuan ($89.3 billion), up 42.3 billion yuan year-on-year, latest data showed on Friday.

This figure was 308.9 billion yuan lower than September, according to a statement from the People's Bank of China.

Aggregate social financing, a measure of funds raised by entities through bank credit and other means, dropped 472.8 billion yuan compared with September and 201.8 billion yuan year on year to reach 662.7 billion yuan in October.

M2, a broad measure of money supply that covers cash in circulation and all deposits, increased 12.6 percent year on year to 119.92 trillion yuan at the end of October, lower than the 12.9-percent growth seen in September.

The narrow measure of money supply (M1), which covers cash in circulation plus demand deposits, rose 3.2 percent year on year to 32.96 trillion yuan at the end of last month, down 1.6 percentage points from September and 5.7 percentage points from a year ago.

In terms of the breakdown of new loan figures, short term loans rose 56.9 billion yuan in October, while bill financing rose 117.1 billion yuan in October. Medium and long-term loans rose 342.7 billion yuan in October, about 62.5 percent of the total new loans.

By sector, new household loans came in at 158.5 billion yuan in October and new corporate loans at 389.0 billion yuan in October.

At the end of October, yuan deposits came in at 112.47 trillion yuan, up 9.5 percent year on year. The growth rate was 0.2 percentage points higher than September, but 5 percentage points lower year on year.

In October, yuan deposits shrank 186.6 billion yuan, down 216.1 billion yuan year on year. Among which, corporate deposits fell 448.2 billion yuan in October, household deposits fell 539.5 billion yuan and fiscal deposits rose 683.7 billion yuan.

As new loans were lower than expected, the pressure for monetary policy easing has increased significantly, said Bob Liu, analyst at the China International Capital Corp.

The central bank will continue to adopt the current approach of monetary easing in "unconventional ways," including using monetary instrument innovations to support certain sectors, said Zhu Haibin, J.P. Morgan's chief China economist.

China's inflation grew 1.6 percent year on year in October. Its gross domestic product (GDP) expanded at a slower pace of 7.3 percent in the third quarter.