Feedback Corner

Publications and Research

Media Releases

Domestic Liquidity Expands Further in July


Preliminary data show that domestic liquidity (M3) grew by 13.1 percent year-on-year to P8.8 trillion in July. This was faster than the 12.4-percent expansion recorded in June. On a month-on-month seasonally-adjusted basis, M3 increased by 1.0 percent.

Money supply continued to expand on account of sustained demand for credit. Domestic claims grew by 16.5 percent in July from 16.9 percent in June as credits to the private sector increased further. The bulk of bank loans during the month continued to go to key production sectors such as real estate activities; electricity, gas, steam and airconditioning supply; and wholesale and retail trade, repair of motor vehicles and motorcycles. Net claims on the central government also rose by 25.4 percent in July from 25.3 percent (revised) a month earlier, as a result of withdrawals by the National Government of its deposits with the BSP.

Meanwhile, net foreign assets (NFA) in peso terms grew by 12.5 percent in July from 11.1 percent (revised) in the previous month. The BSP’s NFA position continued to expand during the month on the back of robust foreign exchange inflows coming mainly from overseas Filipinos’ remittances, business process outsourcing receipts, and portfolio investments. Meanwhile, the NFA of banks increased as their their foreign assets grew. Banks’ foreign assets continued to grow primarily because of investments in marketable debt securities and interbank loans, while banks’ foreign liabilities fell due to decreased placements made by foreign banks with their Philippine branches.

The robust expansion of M3 in July indicates that overall liquidity remains adequate to support economic growth. Moving forward, the BSP will continue to monitor monetary conditions closely to ensure that liquidity growth remains consistent with the BSP’s objectives of price and financial stability.

View Table

RSS Subscribe for updates