Broad Money Increased by LP 66B during the Week Ending November 19
During the week ending November 19, 2015, broad Money M3 increased by LP 66B ($43.91M) to reach LP 183,879B ($121.98B). M3 registered a 4.88% yearly growth and a 3.65% year-to-date growth.
In contrast, M1 decreased by LP 184B ($122M) over the mentioned period, due to the decline in money in circulation by LP 120B ($77M) and the LP 64B ($43M) contraction in demand deposits.
Total deposits (excluding demand deposits) grew by LP 250B ($166M) during the week ending November 19, given the LP 56B increase in term and saving deposits in LP and the $129M expansion in deposits denominated in foreign currencies.
Over the above mentioned period, the broad money dollarization rate experienced an uptick from 57.80% on November 12th to 57.89% on November 19th. According to the Central Bank, the overnight interbank rate increased from 2.75% at the end of August 2015 to 3.00% at end September.
In the TBs auction held on the 26th of November 2015, the Ministry of Finance (MoF) raised LP 421B ($279M), through the issuance of bills and notes maturing in 6M, 2Y and 7Y. The highest demand was achieved on the 7Y notes, which grasped a 48% share in total subscriptions, while the 6M bills and 2Y notes captured the remaining 7% and 45%, respectively. The yield on the 6M bills stood at 4.87%, while the coupon rates on the 2Y and 7Y notes stood at 5.84% and 7.08%, respectively. New subscriptions exceeded maturing T-bills by LP 92B ($61M).
