Domestic liquidity, or the amount of money circulating in the economy, grew by 8.6 percent year-on-year to ₱19.7 trillion in January, preliminary data show.
Growth of domestic liquidity, also known as M3, was faster in January than the 7.2-percent increase in December (revised).
After adjusting for seasonal fluctuations, M3 increased by 0.8 percent month-on-month in January.
M3 is a broad measure of money supply that includes currency in circulation, bank deposits, and other financial assets that are easily convertible to cash.
As a driver of money supply, claims on the domestic sector, which includes private and government entities in the country, rose by 10.0 percent year-on-year in January from 10.5 percent in December (revised). Claims on a sector represent that sector's liabilities to depository corporations (e.g., banks and the central bank).
Claims on the private sector alone grew by 10.6 percent in January from
10.7 percent in the previous month (revised), driven by the continued expansion in bank lending to non-financial private corporations and households.
Net claims on the central government increased by 8.9 percent in January from 10.8 percent in the previous month, driven mainly by its higher borrowings.
Net foreign assets (NFAs) in peso terms rose by 10.2 percent year-on-year in January from 5.9 percent in December (revised). NFAs represent the difference between claims on nonresidents and liabilities to nonresidents of depository corporations.
NFAs of the BSP increased by 9.2 percent. Similarly, NFAs of banks grew primarily on account of lower foreign currency-denominated bills payable.
The BSP will continue to ensure that domestic liquidity conditions remain consistent with its price and financial stability objectives. PR