S. Korea's money supply keeps rising in July on record-low policy rate
Source: Xinhua | 2020-09-12
South Korea's money supply kept rising in July on the back of a record-low policy rate, central bank data showed Friday.
The M2, or broad money, amounted to 3,092.8 trillion won (2.6 trillion U.S. dollars) in July, up 10.1 percent from a year earlier, according to the Bank of Korea (BOK).
The continued growth came as the BOK cut its target rate by 25 basis points to an all-time low of 0.50 percent in May after slashing it by 50 basis points in March.
The M1, or narrow money, jumped 23.0 percent in July from a year earlier.
The M1 refers to currency in circulation, demand deposit and transferable savings deposit equivalent to cash. The M2 adds money market funds, time deposit and financial products that mature in less than two years to M1.
The liquidity on financial institutions, called Lf, gained 8.5 percent in the cited month. The year-on-year increase of liquidity aggregate, the broadest measure of money supply, was 8.5 percent.
The Lf includes financial products with a maturity of more than two years and liquidity at insurers and brokerages along with M2. The liquidity aggregate adds state and corporate bonds to the Lf.
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