M3 Recorded a 5.61% y-o-y Growth by May 21

During the week ending May 21th 2015, broad Money M3 increased by LP 108B ($71.51M), to reach LP 180,584B ($119.79B) with a 5.61% yearly growth and a 1.8% y-t-d uptick. Meanwhile, M1 went down by LP 29B ($19.37M) due to the increase in demand deposits by LP 53B ($35.16M) which was offset by the decrease in money in circulation by LP82 ($54.39M).

Total deposits (excluding demand deposits) went up by LP 137.09B ($90.94M), over the week, given the expansion of deposits denominated in foreign currencies by $92M while term and saving deposits in domestic currency decreased by LP 1B. Over the above mentioned period, the broad money dollarization rate experienced an up-tick from 58.33% in May 14, to 58.37%. According to the Central Bank, the overnight interbank rate remained constant at 2.75% at the end of March 2015.

In the TBs auction held on the 28th of May 2015, the Ministry of Finance raised LP 309.22B ($205.12M), through the issuance of bills and notes maturing in 6M and 3Y notes. The highest demand was achieved on the 3Y notes, with an 81.69% share of total subscriptions while the 6M bills captured the remaining 18.31%. In addition, the 6M bills yielded at 4.87%, while the coupon rate of the 3Y notes stood at 6.50%.

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