Broad Money Supply M3 Grew by $423M by March 1, 2018

 During the week ending on March 1, 2018, Broad Money (M3) rose by a weekly LBP 638B ($423M) to reach LBP 208,977B ($139B). On a yearly basis, M3 added 3.57% and marginally rose by 0.43% since the start of the year.

M1 grew by LBP 653B ($433M) to LBP 10,434B ($7B) over the week. The increase is attributed to a LBP 210B ($139M) uptick in currency in circulation and a LBP 443B ($294M) growth in demand deposits.

Total deposits (excluding demand deposits) dropped by LBP 15B ($10M) over the same week, on the back of a fall of $73M in deposits denominated in foreign currencies but a weekly uptick of LBP 96B ($64M) in Term and savings deposits denominated in local currency (LBP).

The broad money dollarization rate dropped from 61.76% last week to 61.52% by March 1, 2018. According to the Central Bank, the overnight interbank rate steadied at 4% in January 2018.

In the Treasury Bills Auction held on March 8, 2018, the Ministry of Finance (MoF) raised LBP 557B ($369M), through the issuance of bills maturing in 3 months (3M) and 12M, as well as notes maturing in 5 years (5Y). The largest demand was achieved on the 5Y notes, which accounted for 62.91% of total subscriptions, while the 3M bills and 12M bills accounted for the remaining shares of 18.14% and 18.95%, respectively. The discount rates on the 3M and 12M bills stood at 4.87% and 5.08%, respectively, while the coupon rate on the notes maturing in 5Y stood at 6.74%. The new subscriptions exceeded the existing maturities by LBP 183B ($121M).


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