S. Korea’s money supply grows for 15th month in August

SEOUL, Oct. 16 (Xinhua) — South Korea’s money supply grew for the 15th consecutive month in August due to robust demand for deposits, central bank data showed Wednesday.
The seasonally-adjusted M2, or broad money, gained 0.2 percent to 4,062.6 trillion won (2.98 trillion U.S. dollars) in August compared to the previous month, continuing to expand since June last year, according to the Bank of Korea (BOK).
The continued expansion was attributed to strong demand for short-term financial instruments such as time deposits and currency-relevant products.
The M1, or narrow money, rose 0.1 percent in August on a monthly basis, marking the first rebound in five months.
The BOK cut its benchmark interest rate by 25 basis points to 3.25 percent earlier this month amid high expectations for less tightened monetary policy.
The M1 refers to currency in circulation, demand deposits and transferable savings deposits equivalent to cash. The M2 adds money market funds, time deposits and financial products that mature in less than two years.
The liquidity of financial institutions, called Lf, fell 0.1 percent in the cited month, while the liquidity aggregate, the broadest measure of money supply, stood unchanged.
The Lf includes financial products with a maturity of over two years and liquidity at insurers and brokerages along with M2. The liquidity aggregate adds state and corporate bonds to the Lf. ■