Broad Money M3 Up to $140B by August 23rd, 2018

During the week ending on August 23rd, Broad Money (M3) added a weekly LBP 37B ($24M) to stand at LBP 211,648B ($140B). M3 rose by an annual 1.23% and by 1.71% since December 2017.

In details, M1 dropped by a weekly LBP 93B ($62M) to reach LBP 10,968B ($7B) by Aug. 23rd owing to an LBP 52B ($35M) decline in demand deposits and an LBP 41B ($27M) downtick in currency in circulation over the week.

Total deposits (excluding demand deposits) rose by LBP 130B ($86M) over the same period and this came on the back of $121M growth in deposits denominated in foreign currencies, which outweighed  the LBP 53B ($35M) decrease in Term and saving deposits in LBP over the week.

In turn, the broad money dollarization rate climbed from 62.13% in the week ending in August 16th, to 62.21% by the week ending August 23rd. According to the Central Bank, the overnight interbank rate was maintained at 5% from June 2018 to July 2018.

In the Treasury Bills Auction held on August 23, 2018, the Ministry of Finance (MoF) raised LBP 101.95B ($68M), through the issuance of bills maturing in 3 months (3M) and 1 year (1Y), in addition to notes maturing in 5Y. The highest demand was achieved on the 5Y notes, which accounted for 49.43% of total subscriptions, while the 3M and 1Y bills accounted for the remaining shares of 24.83% and 25.74%, respectively. The discount rates on the 3M and 1Y bills stood at 4.39% and 5.08%, respectively, while the coupon rate on the notes maturing in 5Y stood at 6.74%. New subscriptions exceeded existing maturities by LBP 10B ($6.6M).


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