Bank lending and domestic liquidity rose by 10% in July, according to data from the Bangko Sentral ng Pilipinas (BSP).
As domestic liquidity determines how much money is available in the financial system, the Philippine central bank says the faster growth is testament to sustained lending to businesses and consumers.
According to a report by the Philippine News Agency, domestic liquidity climbed by 10.3% to PHP20.5 trillion, continuing to support economic activity.
BSP said the July growth of M3, which is a broad measure of money supply that includes currency in circulation, bank deposits, and other financial assets that are readily convertible to cash, was driven by borrowings from both the private and public sectors.
BSP will carry on in ensuring that domestic liquidity conditions remain consistent with price and financial stability objectives.
Meanwhile, BSP says loans from universal and commercial banks (U/KBs) grew at a faster pace of 10.4% in July compared to 9.8% in June, with outstanding loans issued by U/KBs amounting to PHP14.98 trillion.
The BSP said the faster growth reflects sustained lending to businesses and consumers.
Loans for business activities accelerated to 9.8% from 9.2% in June amid increased lending to key sectors, such as electricity, gas, steam, and air-conditioning supply, wholesale and retail trade, repair of motor vehicles and motorcycles, financial and insurance activities, and information and communication.
The Philippine central bank is monitoring bank loans as they are a key transmission channel of monetary policy.
