During the week ending December 06, Broad Money (M3) rose by a weekly LBP 197B ($131M) to stand at LBP 210,841B ($139.86M). On a yearly basis, M3 added 1.69% and marginally increased by 1.32% since the start of the year.
In fact, M1 expanded by LBP115B ($76.28M) during the week of 29 November to 06 December 2018, to stand at LBP 10,025B ($6.65M). This expansion was driven by the increase in currency in circulation of LBP 384B ($254.72M) and a decrease in demand deposits of LBP 269B ($178.44M).
Total Deposits (excluding demand deposits) rose by LBP 82.01B ($54.50M) over the week. This rise was a result of with an increase in deposits denominated in foreign currencies by $435M that overshadowed the drop in Term and saving deposits in LBP over the week ending December 06 by LBP 574B ($380M).
As such, the rate of broad money dollarization grew from 63.35% to 63.60% this week. As for the overnight interbank rate, data from the central bank showed it steadied at 5% from May 2018 to October 2018.
In the Treasury Bills Auction held on December 6, the Ministry of Finance (MoF) raised LBP 169.07B ($112.15M), through the issuance of bills maturing in 6 months (6M) in addition to notes maturing in 3 years (3Y) and 7 years (7Y). The highest demand was achieved on the notes maturing in 3Y which constituted 69.82% of total subscriptions while notes maturing in 7 years and the 6M bills accounted for the remaining stakes of 25.21% and 4.97% respectively.
The discount rate on the 6M bills stood 4.87%, while the coupon rate on the notes maturing in 3Y and 7Y stood at 6.50% and 7.08% respectively.