Domestic Liquidity Expands 7.7% Year-on-Year in December

Preliminary data from the Bangko Sentral ng Pilipinas (BSP) showed that domestic liquidity (M3) grew by 7.7% year-on-year to ₱18.8 trillion in December 2024, maintaining the same pace as the previous month. On a month-on-month seasonally adjusted basis, M3 increased marginally by 0.2%.

Domestic claims expanded by 10.4% year-on-year in December, slightly lower than the 10.8% growth in November. This was driven by:

• Claims on the private sector, which grew by 12.2% (up from 11.7% in November), reflecting continued bank lending to non-financial private corporations and households.
• Net claims on the central government, which expanded by 7.2%, down from 9.2%, due to higher borrowings by the National Government.

Net foreign assets (NFA) in peso terms rose by 6.0% year-on-year in December, lower than the 9.8% increase in November.

• The BSP’s NFA expanded by 6.8%, reflecting an increase in gross international reserves compared to a year ago.
• The NFA of banks declined due to higher bills and bonds payable.