During the week ending October 18th, Broad Money (M3) shrank by a weekly LBP 309B ($205M) to stand at LBP 211,342B ($140B). As such, M3 rose by an annual 1.03% and by 1.56% since December 2017.
In fact, M1 retreated by LBP 404B ($268M) during the week, to stand at LBP 10,745B ($7B). The decline in M1 was driven by downticks in both, demand deposits as well as currency in circulation by the respective amounts of LBP 209B ($139M) and LBP 195B ($129M), respectively.
Total deposits (excluding demand deposits) increased by LBP 95B ($63M) over the week on the back of the LBP 108B ($71M) rise in Term and saving deposits in LBP and the $8M fall in deposits denominated in foreign currencies.
As such, the rate of broad money dollarization grew from 62.96% to 63.05% this week. As for the overnight interbank rate, data from the central bank showed it steadied at 5% from August 2018 to September 2018.
In the Treasury Bills Auction held on November 01st 2018, the Ministry of Finance (MoF) raised LBP 136B ($90M), through the issuance of bills maturing in 3 months (3M) and 12M, in addition to notes maturing in 5 years (5Y). The highest demand was achieved on the 5Y notes, which grasped 55.14% of total subscriptions, while the 3M and 12M bills accounted for the remaining stakes of 41.16% and 3.7%, respectively. The discount rate on the 3M and 12M bills stood at 4.39% and 5.08%, respectively, while the coupon rate on the notes maturing in 5Y stood at 6.74%.