Money supply up, bank lending slows

Posting a 6.4 percent growth in May, M3 or domestic liquidity proved to be faster than the recorded 4.7 percent expansion month-ago.

Preliminary data from the Bangko Sentral ng Pilipinas (BSP) show domestic claims increased at a significantly faster pace with 5.3 percent from the recorded 2.6 percent month-ago owing to the 27.8 percent growth in net claims on the central government.

“On a month-on-month seasonally-adjusted basis, M3 increased by 1 percent,” the BSP said.

On the other hand, outstanding loans of universal and commercial banks net of reverse repurchase (RRP) placements with the BSP declined by 2 percent in June, a softer slide from the 4 percent drop in May.

“Loans to residents, net of RRP, fell by 1.4 percent (from 3.5 percent contraction in May) while outstanding loans to non-residents decreased by 19.7 percent (from 18.8 percent decline last month),” it explained.