MANILA, Philippines (Xinhua) - Money supply growth slowed to 16.2 percent on year to P7.2 trillion ($160.53 billion) in September, the central bank said today.
Data released by the Bangko Sentral ng Pilipinas (Philippine central bank or BSP) showed that domestic liquidity or M3 expansion in September was slower than the 18.3 percent recorded in August.
The BSP said money supply went up in September due to the sustained demand for loans in the domestic economy.
BSP data showed that domestic claims rose by 16 percent on year to P6.58 trillion ($146.79 billion) during the period. The bulk of the loans went into the wholesale and retail trade; utilities; real estate, renting, and business services; manufacturing; and financial intermediation activities.
"Domestic liquidity growth is expected to further moderate to levels consistent with domestic demand, as previous monetary adjustments continue to work their way through the economy," the BSP said in a statement.
The BSP earlier raised the banks' reserve requirement ratios by 200 basis points and the Special Deposit Account (SDA) rate by 25 basis points to 2.25 percent to pull down high liquidity growth.
M3 growth reached 30 percent in July, 2013 and remained above that threshold after the central bank reduced the SDA rate by 150 basis points last year and restricted deposits of investment management accounts or the singular fund accounts usually offered to retail investors in the facility.