Preliminary data show that domestic liquidity (M3) grew by 7.7% year-on-year to about P15.3 trillion in December 2021 following an 8.3% expansion in November. On a month-on-month seasonally-adjusted basis, M3 rose by 0.2%.
Domestic claims grew by 8.0% year-on-year in December from 8.1% in the previous month due to the sustained expansion in net claims on the central government as well as the continued improvement in bank lending to the private sector. Net claims on the central government rose by 21.7% in December from 24% (revised) in November due to the sustained borrowings by the National Government. Claims on the private sector, driven by bank lending to non-financial private corporations, increased by 3.6% in December from 3% in November.
Net foreign assets (NFA) in peso terms expanded by 6.5% in December from 8.8% in November. The slower growth in BSP’s NFA position during the month reflected the decline in the country’s gross international reserves relative to the same period a year ago. Meanwhile, the NFA of banks increased as banks’ foreign assets increased on account of higher loans with nonresident banks.
Looking ahead, the BSP will continue to monitor liquidity conditions closely in preserving adequate support to the domestic economic recovery, consistent with the BSP’s price and financial stability objectives. (PR) – bny
