Liquidity or money supply in the financial system grew 12.8 percent year-on-year to P8.9 trillion in October, driven mainly by sustained demand for credit, Bangko Sentral ng Pilipinas said Tuesday.
The October expansion was slightly faster than the revised 12.7-percent growth registered in September.
“The expansion in M3 remains manageable and consistent with the BSP’s current outlook for inflation and economic activity,” Bangko Sentral said in a statement.
Domestic claims grew 16.7 percent, faster than 16.2 percent in September due largely to sustained growth in credit to the private sector. Meanwhile, net claims on the central government expanded 24.8 percent as a result of continued withdrawals by the government of its deposits with Bangko Sentral in line with continued efforts to raise fiscal spending.
Meanwhile, outstanding loans of commercial banks grew 17.7 percent in October, slightly slower than the 17.8-percent growth in September.
Loans for production activities increased 17.4 percent in October, supported by increased lending to real estate activities (20 percent); electricity, gas, steam and airconditioning supply (24.8 percent); wholesale and retail trade, repair of motor vehicles and motorcycles (12.2 percent); manufacturing (8.6 percent); and information and communications (40.8 percent).
Loans for household consumption rose 22.2 percent in October, led by continued growth in motor vehicle loans and salary-based general purpose loans as well as expansion in credit card loans, which offset the decline in other types of household loans.
“The BSP will continue to ensure that the expansion in domestic credit and liquidity conditions keeps pace with overall economic growth while remaining consistent with the BSP’s price and financial stability objectives,” Bangko Sentral said.