The Bangko Sentral ng Pilipinas, or BSP, on Wednesday reported the country's domestic liquidity or money supply increased by 6.8 percent to around P16.5 trillion in August, up from 5.7 percent in July year-on-year.

When compared month-on-month, BSP said domestic liquidity slightly grew by 1.6 percent. Domestic liquidity refers to savings, deposits, and unsecured debts from financial firms.

Claims on residents rose by 9.1 percent in August, higher than 8.9 percent in July year-on-year.

Claims on the private sector posted a 7.3 percent growth from 8.2 percent during the same period as BSP said bank lending to non-financial private corporations and households continued.

Meanwhile, net claims on BSP rose by 14.7 percent from 12.5 percent with more borrowings by the government.

Net foreign assets, on the other hand, grew by 3.2 percent in August from 2.6 percent decline in July year-on-year and after a 0.5 percent contraction month-on-month.

"Similarly, the NFA of banks went up on account of lower bonds payable," BSP said.

The total outstanding loans of universal and commercial banks grew slower by 7.2 percent in August compared to 7.7 percent in July year-on-year, while it inched up by 0.6 percent month-on-month amid high interest rates.

Outstanding loans to residents grew by 7.2 percent in August, slower than 7.7 percent in July year-on-year.

Similarly, growth in outstanding loans for production activities decelerated to 5.5 percent from 6.2 percent.