|($B)||29-Dec-21||22-Dec-22||29-Dec-22||Change over the Period (in $M)||Y-O-Y % Change||% Change |
|M 3 ||133.27||148.11||150.81||2,695||13.16%||13.58%|
|M 4 ||142.56||160.30||162.87||2,573||14.25%||14.59%|
BDL’s latest statistics on money supply revealed that Broad Money (M3) increased by LBP 4,062.7B ($ 2,695.7M) to stand at LBP 227,343B ($ 150.81B) by the week ending December 29, 2022. Furthermore, on an annual basis, M3 added 13.16% year-over-year and 13.58% since year-start (YTD).
In details, M1 increased by LBP 4,159B ($ 2,759M) by a week to settle at LBP 97,084B ($ 64.4B) by December 29, 2022; due to an increase in currency in circulation of LBP 752 billion and in demand deposits of LBP 3,407 billion.
In turn, total deposits (excluding Demand deposits) fell by LBP 96B ($ 64M), owing to a rise in Terms and saving deposits by LBP 153B ($101M) and a drop in deposits denominated in foreign currencies by LBP 249B ($165M).
As such, the rate of broad money dollarization decreased from 50.24% in the week ending December 22, 2022 to 49.23% in the week ending December 29, 2022.
Looking at interest rates, the average rate on deposits in LBP at commercial banks decreased from 1.03% in January 2022 to 0.73% in January 2023. Similarly, the average rate on deposits in USD at commercial banks decreased from 0.18% in January 2022 to 0.09% in January 2023. In its turn, the average lending rate in LBP and USD, at commercial banks, went down from 6.4% and 6.15% in January 2022 to 5.61% and 5.38%, respectively, in January 2023.
Analytically, the money supply M3 can be derived from combining the balance sheet of BDL with the balance sheet of banks to arrive at the monetary survey of the banking system. The resulting M3 would be equal to the sum of: net foreign assets (NFA), credit to the private sector (CPS), net credit to the public sector (NCPS), and other items net (OIN). Latest data show that in January 2023, M3 stood at $149.59B, 14.47% higher than January 2022; NFA were $12.54B, less by 15.24% YOY; CPS was $19.56B, less by 25.6% YOY; NCPS was $18.11B, less by 44.45% annually; and OIN were $99.38B, higher by an annual 74.37%, and comprising mostly (in BDL’s terminology) other assets which include open market operations and seigniorage, considered to be a controversial account by some.
In its treasury bills (T-Bills) auction dating December 29, 2022, the Ministry of Finance (MoF) did not issue any notes or T-bills.
Source: BDL; MoF