"Expansion of Corporate Loans"... January's Market Money Supply Increases by 7.8%

'Currency and Liquidity in January 2020'
Bank of Korea "Corporate Sector Credit Loans Up... Money Supply Increase"

[Asia Economy Reporter Jang Sehee] Corporate loans have steadily increased, leading to a continued rise in the money supply in the market.

According to the "January 2020 Money and Liquidity" report released by the Bank of Korea on the 17th, the money supply (M2) in January was 2,927.5 trillion KRW (based on the won series, average balance), marking a 7.8% increase compared to a year earlier.

M2 refers to a broad money indicator that includes cash, demand deposits, savings deposits with flexible withdrawal, money market funds (MMF), and time deposits with maturities under two years.

The M2 growth rate peaked at 8.4% in November last year and has maintained a high growth rate above 8% for three consecutive months.

A Bank of Korea official analyzed, "While household loans have decreased due to the government's recent 'Household Debt Stabilization Measures,' credit is increasing mainly in the corporate sector," adding, "The expansion of corporate loans has influenced the increase in the money supply."

By product, MMFs increased by 10.9 trillion KRW, and savings deposits with flexible withdrawal rose by 9.6 trillion KRW.

By economic agents, the money held by households and non-profit organizations increased by 11.8 trillion KRW, and the corporate sector increased by 200 billion KRW.

Meanwhile, M1 (narrow money), a short-term fund indicator, rose 11.5% compared to a year ago and increased 1.4% compared to December, the previous month.

This content was produced with the assistance of AI translation services.