Domestic Liquidity Grows by 6.2% in July 2025
Domestic liquidity, also known as M3, or the amount of money in the economy, grew by 6.2 percent year-on-year to about ₱18.6 trillion in July, according to preliminary data.
Growth of M3 in July was faster than the revised 5.9-percent increase in June.
On a seasonally-adjusted basis, M3 increased by 0.9 percent month-on-month in July.
M3 is a broad measure of money supply that includes currencies in circulation, bank deposits, and other financial assets that are easily convertible to cash.
As a driver of money supply, claims on the domestic sector, which includes private and government entities, rose by 10.5 percent year-on-year in July from the revised figure of 10.8 percent in June.
Claims on the private sector alone grew by 11.0 percent in July from the revised figure of 11.4 percent in the previous month, driven by the continued expansion in bank lending to non-financial private corporations and households.
Net claims on the central government increased by 7.1 percent from the revised figure of 7.7 percent in the previous month, driven by its higher borrowings.
Net foreign assets (NFA) in peso terms decreased by 0.6 percent year-on-year in July from the 1.7-percent decline in June.
The BSP’s NFA fell by 1.2 percent primarily due to the decline in gross international reserves from a year ago. Meanwhile, the NFA of banks grew on account of larger holdings of foreign currency-denominated debt instruments.
The BSP will continue to ensure that domestic liquidity conditions remain consistent with its price and financial stability objectives.
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