During the week ending on February 25th, broad Money M3 grew by LP 197B ($130.36M) to reach LP 185,947B ($123.35B). M3 registered a 5.24% yearly growth and a 0.35% year-to-date downtick.
On the other hand, M1 regressed by LP 9B ($5.81M) over the mentioned period, due to the decrease in money in circulation by LP 83B ($55.06M) in spite of the LP 74B ($49.09M) increase in demand deposits.
Total deposits (excluding demand deposits) increased by LP 205.29B ($136.18M) during the week, given the $268M expansion in deposits denominated in foreign currencies and the LP 199B decrease in term and saving deposits.
Over the above mentioned period, the broad money dollarization rate went up from 57.65% on the 18th of February to 57.81% on the 25th of February. According to the Central Bank, the overnight interbank rate remained steady at December 2015’s rate of 3.25%.
In the TBs auction held on the 3rd March, 2016, the Ministry of Finance (MoF) raised LP 183.77B ($121.90M), through the issuance of bills and notes maturing in 1Y and 5Y. The highest demand was achieved on the 5Y notes, which grasped a 75.67% share of total subscriptions, while the 1Y bills captured the remaining 23.33%. The discount rate on the 1Y bills stood at 5.35%, while the coupon rate on the 5Y notes registered 6.74%. New subscriptions fell behind existing maturities by LP 271B ($179.77M).