During the week ending February 13 2015, broad Money M3 increased by LP 50B ($33.83M), to reach LP 176,357B ($116.99B) with a 4.98% year-on-year growth. Meanwhile, M1 declined by LP 117B ($77.85M) due to the decrease in money in circulation by LP 128B ($84.91M) and an increase of demand deposits by 11B ($7.30M).
Total deposits (excluding demand deposits) edged up by LP 168B ($111.44M), given the increase of deposits denominated in foreign currencies by $68M and term and saving deposits in domestic currency by LP 65B. Over the above mentioned period, the broad money dollarization rate experienced an uptick from 58.49% the prior week to 58.53%. According to the Central Bank, the overnight interbank rate stood at 2.75% at the end of December 2014.
In the TBs auction held on the 26th of February 2015, the Ministry of Finance raised LP 193.62B ($127.77M), through the issuance of bills maturing in 3M, 1Y and 5Y notes. The highest demand was achieved on the 5Y notes that grasped a share of 77.80% of total subscription while the 3M and 1Y bills contributed to the remaining 10.84% and 11.36%, respectively. While the 3M and 1Y bills yielded at respective levels of 4.39% and 5.08%, the average coupon rate for 5Y notes stood at 6.74%. New subscriptions exceeded Maturing T-bills by LP 155.38B ($103.07M).