M3 Down this Week to $139.8B by August 8th 2019

Broad Money (M3) decreased by LBP 473B ($314M) in the week ending Aug. 8th 2019 to stand at LBP 210,716B ($139.8B), retreating by a yearly 0.8% and 0.67% since the start of the year.

In details, M1 slid by LBP 275B ($182M) over the same week, to settle at LBP 10,543B ($6.9B). The decline came on the back of a decrease in Demand deposits by LBP 359B ($238M), which outweighed the LBP 84B ($55.7M) uptick registered in Currency in circulation over the week.

In turn, Total deposits (excluding demand deposits) dropped by LBP 197.8B ($131.2M), owing it to a $165B decline in Term and saving deposits denominated in LBP  while Deposits denominated in foreign currencies retreated by $22M.

As such, the rate of broad money dollarization slightly climbed to 65.26% in the week ending Aug 8th 2019 from 65.12% in the week ending Aug 1st 2019.

In the treasury bills (T-Bills) auction held on August 1 2019, the Ministry of Finance raised LBP 434B ($287.89B) through the issuance of bills maturing in 6 months (6M), and notes maturing in 2 Years (2Y) and 10 Years (10Y). The highest demand was achieved on notes maturing in 10Y, grasping a share of 59.91% of total subscription. Meanwhile, the 6M bills and 2Y notes accounted for the remaining stakes of 1.61% and 38.48%, respectively. The discount rate on the 6M bills stood at 5.68%, while the coupon rates on the notes maturing in 2Y and 10Y stood at 7% and 10%, respectively.

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