Domestic liquidity grows by 6.8 percent in August

Preliminary data show that domestic liquidity (M3) grew by 6.8 percent year-on-year to about ₱15.4 trillion in August from the 7.0-percent growth in July.

On a month-on-month seasonally-adjusted basis, M3 increased by 0.9 percent.

Domestic claims rose by 11.5 percent year-on-year in August, unchanged from the rate recorded in the previous month, given the improvement in bank lending to the private sector.

Claims on the private sector grew by 9.1 percent in August from 8.9 percent in July with the sustained expansion in bank lending to non-financial private corporations and households.

Meanwhile, net claims on the central government rose by 21.2 percent in August from 22.2 percent in July owing to the sustained borrowing by the National Government.

Net foreign assets (NFA) in peso terms decreased by 0.8 percent in August following a 0.5-percent contraction in July.

The NFA of banks likewise contracted mainly on account of higher bills payable. Meanwhile, the Bangko Sentral ng Pilipinas’s (BSP)  NFA position returned to expansion after contracting in the previous month.

Looking ahead, the BSP will continue to ensure that domestic liquidity conditions remain in line with the BSP’s price and financial stability objectives.