Money supply grows 0.5 pct on-month in September

SEOUL, Nov. 11 (Yonhap) — South Korea’s money supply continued to grow in September from a month earlier on increased lending for home purchases, renting and issuance of corporate bonds to secure reserve funds, central bank data showed Thursday.

The country’s M2, a key gauge of money supply, stood at 3,512.1 trillion won (US$2.96 trillion) as of end-September, up 0.5 percent, or 17.4 trillion won, from a month earlier, according to the preliminary data from the Bank of Korea (BOK).

The growth slowed from the previous month’s 1.5 percent gain, but compared with a year earlier, the money supply jumped 12.8 percent, the fastest on-year increase since December 2008 when it rose 13.1 percent, the data showed.

The central bank attributed the increase to continued households’ borrowing for home purchases and renting and corporate bond-selling to secure funds amid expectations for interest rate hikes.

M2 is a measure of the money supply that counts cash, demand deposits and other easily convertible financial instruments.

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