Domestic Liquidity Grows 7.7% in November

Domestic liquidity, or M3, grew by 7.7% year-on-year in November to approximately PHP 18.1 trillion, according to preliminary data from the Bangko Sentral ng Pilipinas (BSP).

The latest data marks an acceleration from the revised 5.4% growth in October.

On a seasonally adjusted month-on-month basis, M3 increased by 1.9%. Domestic claims also expanded by 10.8% year-on-year in November, up from 10% in October.

Claims on the private sector grew by 11.7%, reflecting continued expansion in bank lending to private corporations and households.

Net claims on the central government increased by 9.2% in November, slightly higher than the 8.4% revised growth in October. This growth was partly driven by the National Government’s sustained borrowings.

Net foreign assets (NFA), measured in peso terms, grew by 9.8% year-on-year in November, though slower than October’s revised 11.3%.

The BSP’s NFA increased by 12.8%, buoyed by rising gross international reserves. However, banks’ NFAs contracted due to higher payables in bills and bonds.

“The BSP will continue to ensure that domestic liquidity conditions align with the monetary policy stance to maintain price and financial stability,” the central bank said.

BANK LENDING UP BY 11.1%

Outstanding loans of universal and commercial banks (U/KBs), net of reverse repurchase placements with the BSP, grew by 11.1% year-on-year in November, up from 10.6% in October. Month-on-month, these loans rose by 1%.

Loans to residents, net of RRPs, increased by 11.3% in November, while loans to non-residents grew at a slower pace of 3.8%, down from 6.9% in October.

Lending for production activities, a key driver of growth, rose by 9.8% in November, compared to 9.1% in October.

Key industries such as wholesale and retail trade, motor vehicle and motorcycle repair (9.1%), electricity, gas, steam, and air-conditioning supply (9.6%), and financial and insurance activities (4.4%) contributed to this growth.

Consumer loans to residents continued to expand, increasing by 23.3% year-on-year, slightly down from 24% in October. The rise was driven by credit card and motor vehicle loans.