Broad Money Reached $117.62B by March 5

During the week ending March 5 2015, broad Money M3 increased by LP 512B ($339.68M), to reach LP 177,308B ($117.62B) with a 5.23% year-on-year growth and 0.1% year-to-date decrease. Furthermore, M1 augmented by LP 341B ($226.01M) due to an increase in demand deposits by LP 16B ($10.61M) and the increase in money in circulation by LP 325B ($215.59M).

Total deposits (excluding demand deposits) edged up by LP 171.36B ($113.67M), given the increase of deposits denominated in foreign currencies by $67M and term and saving deposits in domestic currency by LP 71B. Over the above mentioned period, the broad money dollarization rate experienced a downtick from 58.46% the prior week to 58.35%. According to the Central Bank, the overnight interbank rate stood at 2.75% at the end of January 2015.

In the TBs auction held on the 12th of March 2015, the Ministry of Finance raised LP 190.55B ($126.40M), through the issuance of bills maturing in 3M, 1Y and 5Y notes. The highest demand was achieved on the 5Y notes that grasped a share of 78.96% of total subscription whileeach of the 3M and 1Y bills contributed to similar shares of 10.52%, respectively. Furthermore the 3M and 1Y bills yielded respectively 4.39% and 5.08%, while the average coupon rate for 5Y notes stood at 6.74%. New subscriptions exceeded Maturing T-bills by LP 100.64B ($66.76M).

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