Bank lending rose 12% in July from a year ago, providing support for domestic activities that are crucial to economic recovery despite the series of interest rate hikes this year, data from the data show. broadcast Bangko Sentral ng Pilipinas.
The BSP said on Wednesday that outstanding universal and commercial bank loans, net of reverse repurchase investments with the BSP, also rose 0.6% on a seasonally adjusted monthly basis.
“Sustained growth in bank lending and liquidity will support the recovery in economic activity and domestic demand. Going forward, the BSP will continue to ensure that liquidity and credit dynamics remain consistent with the BSP’s price and financial stability objectives,” the BSP said in a statement.
Outstanding loans to residents, net of RRPs, increased by 11.9% in July after the same expansion in June. Loans to production activities increased by 11.6% in July after growth of 12.0% in June, driven by the increase in loans to real estate activities (+14.6%); manufacturing (16.2 percent); information and communication (29.3%); and wholesale and retail trade, repair of automobiles and motorcycles (9.3%).
Consumer loans to residents jumped 14.7% in July, faster than the 10.9% rise in June, due to strong demand for credit card loans, auto loans and home loans. general purpose consumption based on wages.
Outstanding loans to non-residents increased by 14.6% in July after rising by 16.4% the previous month.
Meanwhile, preliminary data also showed that domestic liquidity, or the money supply circulating in the financial system, grew 7.0% year-on-year to around 15.4 trillion pula in July, from a growth of 7.0 .2% in June. The BSP said that on a seasonally adjusted monthly basis, domestic liquidity increased by 0.3%.
Domestic claims rose 11.5% year-on-year in July, from 9.9% the previous month, due to improved bank lending to the private sector. Claims on the private sector increased by 8.9% in July after 8.8% in June with the sustained expansion of bank loans to private non-financial corporations and households.
Net claims on central government increased by 22.2% in July after 15.3% in June, due to the sustained indebtedness of the State.
Net foreign assets in pesos fell 0.5% in July after rising 5.6% in June. The BSP’s NFA position declined during the month, reflecting the decline in gross international reserves compared to the same period a year ago.
The NFA of banks also contracted due to the increase in external deposits and notes payable.
The BSP said that as it proceeds with the withdrawal of monetary easing, it will continue to ensure that domestic liquidity conditions remain conducive to support the economic recovery.