Broad Money M3 Increased by $203M during the Week Ending August 27

During the week ending August 27, 2015, broad Money M3 increased by LP 307B ($203.43M), to reach LP 182,552B ($121.10B) posting a 4.74% yearly growth and a 2.91% y-t-d uptick. Similarly, M1 expanded by LP 44B ($29.43M) over the week due to the increase in demand deposits by LP 136B ($90.22) which was partially offset by the LP 92B ($61.03M) decline in money in circulation.

Total deposits (excluding demand deposits) increased by LP 262B ($174.00M), over the week, given the LP 7B growth in term and saving deposits in LP and the $169M expansion in deposits denominated in foreign currencies. Over the above mentioned period, the broad money dollarization rate experienced an uptick from 58.13% on August 20, to 58.18% on August 27. According to the Central Bank, the overnight interbank rate steadied at 2.75% at the end of June 2015.

In the TBs auction held on the 27th of August 2015, the Ministry of Finance raised LP 165B ($110.04M), through the issuance of bills and notes maturing in 3M, 1Y and 5Y. The highest demand was achieved on the 5Y notes, which grasped 87.46% share of total subscriptions, while the 1Y and 3M bills captured the remaining 9.21% and 3.33%, respectively. The 3M and 1Y bills respectively yielded 4.39% and 5.08%, while the coupon rate on the 5Y notes stood at 6.74%.



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