During the week ending January 15, 2015, broad Money M3 decreased by LP 1,168B ($775.08M), to reach LP 176,321B ($116.96B) with a 5.32% year-on-year growth. This was partly the result of the window-dressing that occurred at the end of 2014. Likewise, M1 retreated by LP 187B ($123.80M) due to the drop in demand deposits by LP 65B ($43.12M) and in money in circulation by LP 122B ($8.93M).
Total deposits (excluding demand deposits) dropped by LP 981.80B ($651.28M), given the contraction in deposits denominated in foreign currencies by $775M, while term and saving deposits in domestic currency went up LP 187B. Over the above mentioned period, the broad money dollarization rate declined from 58.80% the prior week to 58.52%. According to the Central Bank, the overnight interbank rate stood at 2.75% at the end of November 2014.
In the TBs auction held on the 22nd of January 2015, the Ministry of Finance raised LP 1,028B ($681.26M), through the issuance of bills maturing in 6M, and 2Y and 10Y notes. The highest demand was achieved on the 10Y notes that took a share of 89.58%, while the 6M bills and 2Y notes accounted for 5.58% and 4.84%, respectively. The 6M bills yielded 4.87%, while the average coupon rate for the 2Y and 10Y notes stood at 5.84% and 7.98%, respectively. New subscriptions exceeded maturing T-bills by LP 732.79B ($486.10M).