M3, bank lending growth up in July
Credit to Author: MAYVELIN U. CARABALLO, TMT| Date: Tue, 03 Sep 2019 17:45:11 +0000
THE Bangko Sentral ng Pilipinas (BSP) reported on Tuesday that growth in the country’s money supply and bank lending accelerated in July.
In a statement, the central bank said domestic liquidity, or M3, increased by 6.7 percent year-on-year to P11.86 trillion, slightly faster than
June’s 6.4-percent growth. Month-on-month and seasonally adjusted, M3 grew by 0.8 percent.
“Demand for credit eased slightly, but remained the principal driver of money supply growth,” it added.
Expansion in domestic claims decelerated to 5.7 percent from June’s 6.2 percent, “due mainly to the sustained growth in credit to the private sector,“ the Bangko Sentral explained.
Net claims on the central government dropped by 1.8 percent, following a 3.9-percent decline in June, as a result of the increase in deposits by the national government with the BSP.
Net foreign assets in peso terms rose by 5.8 percent, faster than June’s 5.3-percent acceleration.
“The BSP will continue to monitor domestic liquidity dynamics to ensure that overall monetary conditions remain in line with maintaining price and financial stability,” the Bangko Sentral said.
Bank-lending growth accelerated to 11.1 percent in July from 10.5 percent a month earlier.
Including reverse repurchase placements with the BSP, lending growth also rose faster to 10.7 percent from June’s 10.5 percent.
Lending for production activities, which accounted for 87.6 percent of the aggregate loan portfolio, grew by 9.8 percent in July, similar to the pace recorded in the previous month.
Although steady, the growth in production loans was driven primarily by higher lending to these sectors: real estate activities (18.1 percent); financial and insurance activities (19.1 percent); electricity, gas, steam and air conditioning supply (13.8 percent), construction (38.2 percent); and wholesale and retail trade, repair of motor vehicles and motorcycles (4.5 percent).
Bank lending to other sectors also rose during the month, except those in other community, social and personal activities (-41.3 percent) and professional, scientific and technical activities (-36.0 percent).
Growth in household consumption loans surged by 23 percent from 15.3 percent in June, the BSP said, “due to faster growth in motor vehicle and salary-based general purpose consumption loans during the month.”