Domestic liquidity or money circulating in the financial system continued its double-digit expansion in April, although slower than a month ago, Bangko Sentral ng Plipinas said Friday.
Data showed that liquidity, also called M3, grew 14.2 percent year-on-year to about P10.9 trillion in April 2018, slightly slower compared to the 14.4-percent expansion in March.
On a month-on-month seasonally adjusted basis, liquidity increased 1.0 percent.
“Overall domestic liquidity conditions remain broadly in line with the BSP’s prevailing outlook for inflation and economic activity,” the regulator said in a statement.
“Nevertheless, the BSP will continue to closely monitor domestic liquidity to ensure that monetary conditions are conducive to maintaining price and financial stability,” it said.
Domestic claims grew 16.4 percent for the month, up from the 14.5-percent increase in March due to sustained growth in bank lending.
Preliminary data showed outstanding loans of commercial banks, net of reverse repurchase placements with the Bangko Sentral, increased at a faster rate of 19.9 percent in April from 18.5 percent in March.
Loans for productive activities—which comprised 88.5 percent of banks’ aggregate loan portfolio net of RRP—grew faster by 19.6 percent in April from 18.2 percent in the previous month.
The growth in production loans was driven mainly by increased lending to wholesale and retail trade, repair of motor vehicles and motorcycles, 22.7 percent; real estate, 15.7 percent; financial and insurance activities, 27.1 percent; electricity, gas, steam and air-conditioning supply, 17.5 percent; manufacturing, 14.4 percent; other community, social and personal activities, 81.1 percent; transportation and storage, 30.9 percent; and information and communication, 24.6 percent.
Bank lending to other sectors also increased during the month except in agriculture, forestry and fishing, (-6.8 percent), and administrative and support services activities, (-43.5 percent).
