PHL Money Supply Rises to P8.8 Trillion, Bank Lending Grows Faster

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MANILA — Both domestic liquidity and bank lending grew faster in September, according to the Bangko Sentral ng Pilipinas (BSP).

Domestic liquidity (M3) rose to P8.8 trillion, growing by 12.6 percent year-on-year last month, faster than the growth in August at 11.9 percent.

The central bank said money supply growth in September was driven by demand for credit.

“Domestic claims grew by 16.1 percent in September from 15.1 percent in August, due largely to sustained growth in credit to the private sector,” BSP said.

BSP said that expansion in bank loans remained robust due to lending of key production sectors, including real estate activities, electricity, gas, steam and air-conditioning supply, wholesale and retail trade, repair of motor vehicles and motorcycles, manufacturing, and information and communication.

“Net claims on the central government picked up by 23.1 percent from 18.5 percent a month earlier as a result of continued withdrawals by the National Government of its deposits with the BSP,” the central bank said.

Likewise, net foreign assets grew faster in September by 13.5 percent compared to growth rate in August at 8.8 percent.

“Foreign exchange inflows coming from overseas Filipinos’ remittances and business process outsourcing receipts were the main contributors to the BSP’s NFA position.

Meanwhile, the NFA of banks expanded due mainly to growth in banks’ foreign assets, resulting from higher deposits with other banks and investments in marketable debt securities,” the BSP said.

The BSP also reported Friday that outstanding loans of commercial banks expanded by 17.7 percent in September from 17.3 percent in its previous month.

Loans for production activities, accounting for over 80 percent of banks’ aggregate loan portfolio, increased by 17.3 percent.

Loans for household consumption also went up by 21.3 percent in September from 20.3 percent growth in August.

“Going forward, the BSP will continue to ensure that domestic credit and liquidity conditions will keep pace with overall economic growth while remaining consistent with its price and financial stability objectives,” the central bank noted.

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