Money supply growth slowed down in February — BSP

The amount of money circulating in the Philippine financial system -- known as domestic liquidity (M3) -- posted a drop in February, data released by the Bangko Sentral ng Pilipinas (BSP) on Monday showed.

Data released by the central bank showed that domestic liquidity, the broadest measure of money in the economy -- fell by 0.3% to P12.764 trillion in February from the P12.805 trillion in January this year.

Year-on-year, the February figure posted a 10.9% growth from the P11.514 trillion registered in February 2019, but this was still slower than the 12.0% growth in January.

"Demand for credit remained the principal driver of money supply growth," the BSP said in an accompanying statement.

Loans for production activities continued to be driven by lending to key sectors such as real estate activities; financial and insurance activities; electricity, gas, steam and air conditioning supply; information and communication; and construction.

Meanwhile, net claims on the central government grew at a slower pace of 18.4% in February versus the 31.8% growth in the previous month, which the BSP attributed to the increase in deposits by the national government.

"Going forward, the BSP will remain vigilant in monitoring domestic liquidity and credit dynamics amid significant disruptions to economic activity," the BSP said.

"The BSP reassures the public of its commitment and readiness to deploy its full range of instruments to ensure that liquidity and credit remain adequate amid the ongoing health crisis," it added. — RSJ, GMA News