Preliminary data show that domestic liquidity (M3) grew by 7 percent year-on-year to about ?15.4 trillion in July from the 7.2-percent (revised) growth in June. On a month-on-month seasonally-adjusted basis, M3 increased by 0.3 percent.

Domestic claims rose by 11.5 percent year-on-year in July from 9.9 percent (revised) in the previous month due to the improvement in bank lending to the private sector.

Claims on the private sector grew by 8.9 percent in July from 8.8 percent in June with the sustained expansion in bank lending to non-financial private corporations and households. Meanwhile, net claims on the central government rose by 22.2 percent in July from 15.3 percent in June owing to the sustained borrowing by the National Government.

Net foreign assets (NFA) in peso terms decreased by 0.5 percent in July after expanding by 5.6 percent in June. The BSP’s NFA position declined during the month, reflecting the decrease in gross international reserves relative to the same period a year ago. The NFA of banks likewise contracted mainly on account of higher foreign deposit liabilities and bills payable.

As the BSP proceeds with the withdrawal of monetary accommodation, it will continue to ensure that domestic liquidity conditions remain conducive to sustaining the economic recovery, in line with the BSP's price and financial stability objectives. BSP