Domestic liquidity (M3) expanded by 12.2 percent year-on-year to P20.3 trillion in April, slightly higher than the revised 12.1 percent growth recorded in March, according to preliminary data from the Bangko Sentral ng Pilipinas (BSP).

The BSP said the increase was driven mainly by continued growth in lending to non-financial private corporations and households. Claims on the private sector rose 12.6 percent in April, accelerating from the revised 11.9 percent expansion in the previous month.

Net claims on the national government also increased by 15.1 percent, supported by higher holdings of government securities and lower government deposits with the BSP and the banking system.

Meanwhile, net foreign assets in peso terms grew 8.9 percent year-on-year, up from 8.6 percent in March. The BSP attributed the increase to the expansion of its own net foreign asset position and larger foreign currency-denominated debt security holdings among banks.

M3 acts as a broad measure of money supply that includes currency in circulation, bank deposits, and other financial assets that are easily convertible to cash. The BSP said it will continue to monitor liquidity conditions to ensure they remain consistent with its price and financial stability objectives.