| ($B) | 19-Oct-22 | 12-Oct-23 | 19-Oct-23 | Change over the Period | Y-O-Y % Change | % Change y-t-d |
| M 1 | 56.59 | 5.67 | 5.49 | (0.18) | -90.30% | -91.47% |
| M 2 | 68.37 | 6.69 | 6.53 | (0.16) | -90.46% | -91.48% |
| M 3 | 144.39 | 77.17 | 76.82 | (0.35) | -46.79% | -49.06% |
| M 4 | 156.32 | 78.69 | 78.34 | (0.36) | -49.89% | -51.90% |
BDL’s latest statistics on money supply revealed that Broad Money (M3) decreased by LBP 5,225B to stand at LBP 1,152,331B ($ 76.82B) by the week ending October 19, 2023. Furthermore, on an annual basis, M3 dropped by 46.79% year-over-year and by 49.06% since year-start (YTD). Noting that effective February 1st 2023, the official exchange rate has been set at LBP 15,000 per dollar.
In details, M1 dropped by LBP 2,627 B by a week to settle at LBP 82,380B ($5.49B) by October 19, due to a decrease in currency in circulation of LBP 1,686.99 billion and in demand deposits of LBP 939.90 billion.
In turn, total deposits (excluding Demand deposits) decreased by LBP 2,597.89B ($173.19B), owing to an increase in Terms and saving deposits by LBP 207.59B and a drop in deposits denominated in foreign currencies by $187.03M.
As such, the rate of broad money dollarization slightly increased from 91.335% in the week ending October 12, 2023 to 91.506% in the week ending October 19, 2023.
Looking at interest rates, the average rate on deposits in LBP at commercial banks decreased from 0.6% in August 2022 to 0.41% in August 2023. Similarly, the average rate on deposits in USD at commercial banks decreased from 0.1% in August 2022 to 0.03% in August 2023. In its turn, the average lending rate in LBP and USD, at commercial banks, went down from 4.85% and 5.51% in August 2022 to 3.77% and 2.4%, respectively, in August 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 August 2023, M3 stood at LBP 1,175,650.9B versus LBP 192,515.4B in August 2022: NFA were LBP 216,409.8B compared to LBP 17,350.6B in August 2022; CPS was LBP 130,570.3B compared to LBP 33,983.5B in August 2022; NCPS was LBP 835,517.3B compared to LBP 41,988.4B in August 2023; and OIN were negative LBP 6,846.5B compared to LBP 99,193B in August 2022.
Source: BDL; MoF