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S.Korea's money supply keeps rising in February

Xinhua News,SEOUL
2020-04-10 15:35

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SEOUL, April 10 (Xinhua) -- South Korea's money supply kept rising in February amid the record-low interest rate, central bank data showed Friday.

The M2, called broad money, advanced 8.2 percent in February from a year earlier, after growing 7.8 percent in the previous month, according to the Bank of Korea (BOK).

It came as the BOK had left its benchmark interest rate at a record low of 1.25 percent since October last year. The BOK slashed its key rate by 50 basis points to an all-time low of 0.75 percent in March in its first emergency move since the 2008 global financial crisis.

The M1, dubbed narrow money, was up 12.0 percent in February from a year ago, after expanding 11.5 percent in January.

The M1 refers to the currency in circulation, demand deposit, 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 of financial institutions, called Lf, increased 8.5 percent in the cited month. The year-over-year growth of liquidity aggregate, the broadest measure of money supply, was 8.0 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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