Domestic liquidity expands by 8.3 Percent in November 2021

Preliminary data show that domestic liquidity (M3) expanded by 8.3 percent year-on-year to about ₱14.8 trillion in November 2021, unchanged from the growth rate (revised) recorded in October.

On a month-on-month seasonally-adjusted basis, M3 increased by 0.5 percent.

Domestic claims grew by 8.1 percent year-on-year in November from 7.5 percent in the previous month due to the increase 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 23.9 percent in November from 21.7 percent (revised) in October on the back of sustained borrowings by the National Government.

Claims on the private sector, driven by bank lending to non-financial private corporations, increased by 3.0 percent in November from 2.6 percent in October.

Net foreign assets (NFA) in peso terms expanded by 8.8 percent in November from 8.7 percent (revised) in October.

The Bangko Sentral Pilipinas’s (BSP) NFA position improved during the month, reflecting the increase in the country’s gross international reserves relative to the same period a year ago.

Similarly, the NFA of banks increased as banks’ foreign assets went up on account of higher loans with nonresident banks.

Looking ahead, the BSP will ensure that domestic liquidity conditions continue to provide the necessary support to domestic economic activity amid downside risks to the economic recovery, in line with its price and financial stability objectives.