China's credit expansion slowed in July while bank deposits declined, the People's Bank of China, the country's central bank, said on Friday.

The country's new yuan-denominated loans totaled 16.08 trillion yuan ($2.22 trillion) in the first seven months of the year, representing a growth of 1.67 trillion yuan compared with the same period of last year, the PBOC said.

In July, however, new yuan-denominated loans came in at 345.9 billion yuan, down by 349.8 billion yuan from a year ago and slumping from 3.05 trillion yuan in June. Meanwhile, yuan-denominated deposits decreased by 1.12 trillion yuan last month, reversing an increase of 3.71 trillion yuan in June.

Aggregate social financing — the total amount of financing to the real economy — also decelerated as the increment in aggregate social financing amounted to 528.2 billion yuan in July, down by 270.3 billion yuan year-on-year, the central bank said.

The country's outstanding aggregate social financing stood at 365.77 trillion yuan as of the end of July, marking a year-on-year growth of 8.9 percent, compared with 9 percent a month earlier.

The broad money supply, or M2, stood at 285.4 trillion yuan as of the end of last month, up 10.7 percent year-on-year. The growth rate was 0.6 percentage point down from a month earlier and 1.3 percentage points lower than a year ago.