Broad Money Went Up by LP 55B by June 25

During the two-week period ending June 25 2015, broad Money M3 increased by LP 55B ($36.25M), to reach LP 181,246B ($120.23B) with a 5.20% yearly growth and a 2.17% y-t-d uptick. In contrast, M1 went down by LP 94B ($62.75M) due to the decrease in currency in circulation by LP 175B ($116.09M) offsetting the LP 81B ($53.73M) increase in demand deposits.

Total deposits (excluding demand deposits) went up by LP 149.25B ($99.01M), over the two  weeks, given the LP 163B increase in term and saving deposits and the $9M contraction in deposits denominated in foreign currencies. Over the above mentioned period, the broad money dollarization rate experienced a down-tick from 58.18% on June 11, to 58.15% on June 25. According to the Central Bank, the overnight interbank rate remained at 3.00% at the end of April 2015.

In the TBs auction held on the 2nd of July 2015, the Ministry of Finance raised LP 170.94B ($113.39M), through the issuance of bills and notes maturing in 3M, 1Y and 5Y. The highest demand was achieved on the 5Y notes, with a 79.65% share of total subscriptions, while the 3M and 1Y bills captured the remaining 10.78% and 9.57%, respectively. The 3M and 1Y bills yielded 4.39% and 5.08%, while the coupon rate of the 5Y notes stood at 6.74%. New subscription exceeded maturing bills by LP 67.09B ($44.50M).

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