During the week ending on December 14, Broad Money (M3) declined by a weekly LBP 380B ($252M) to reach LBP 206,053B ($137M). On a yearly basis, M3 grew by 4.12% and by 3.52% since the start of the year.
Over the same period, M1 dropped by LBP 119B ($79M) to LBP 9,898B ($7B). The fall is due to a decrease in currency in circulation by LBP 133B ($88M) which outweighed the increase in demand deposits by LBP 14B ($9M).
Total deposits (excluding demand deposits) fell by LBP 261B ($173M) over the same period, as term and savings deposits denominated in local currency (LBP) dropped by LBP 46B ($30M) during the week, while deposits denominated in foreign currencies fell $143M.
The Broad Money dollarization rate rose from 61.96% on December 7, 2017 to 62.13% on December 14, 2017. According to the Central Bank, the overnight interbank rate steadied at 4% for the months of September and October 2017.
In the Treasury Bills Auction held on December 21, 2017, the Ministry of Finance (MoF) raised LBP 688B ($456M), through the issuance of bills maturing in 6 months (6M), and notes maturing in 2 years (2Y) and 10Y. The highest demand was achieved on the 10Y notes, which accounted for 87.39% of total subscriptions, while the 6M bills and the 2Y notes accounted for the remaining shares of 3.04% and 9.57%, respectively. The discount rate on the 6M bills stood at 4.87%, while the coupon rate on the notes maturing in 2Y and 10Y stood at 5.84%, and 7.08%, respectively. New subscriptions lagged behind existing maturities by LBP 21B ($14M).