Kuwait – The Central Bank of Kuwait announced on Wednesday that the broad money supply (M2) decreased by 0.3% during October on a monthly basis, reaching 41.9 billion Kuwaiti dinars, according to statistical tables issued by the Economic Research Department and reported by the Kuwait News Agency (KUNA).
Private sector deposits decline
The data showed a decrease in private sector deposits in Kuwaiti dinars by 0.5% to reach 38.5 billion dinars, while deposits in foreign currencies increased by 2.4% to reach 2 billion dinars.
Bond stability and rising assets
Local banks’ claims on the central bank remained stable at 201 million dinars, while total assets of local banks rose to 100 billion dinars, an increase of 1.1%.
Net foreign assets held by local banks saw a slight increase of 0.2%, reaching 14.7 billion dinars.
Decrease in time deposits and rise in loans
The data also indicated a 14.3% decrease in time deposits and corresponding repurchase agreements at the Central Bank, bringing their total to 600 million dinars.
Conversely, credit facilities (loans) increased by 1% to reach 62.7 billion dinars.
Increased import financing and a stronger dollar
On the trade front, financing for Kuwaiti imports rose by 6.6% to reach 888 million dinars.
The average exchange rate of the US dollar against the dinar also saw a slight increase of 0.1%, reaching 305.3 fils.
What is the money supply (M2)?
Broad money supply represents the total liquidity available in the economy, and includes:
Cash in circulation + Current accounts + Demand deposits + Time deposits + Savings accounts.
This indicator is one of the most important tools used to measure the level of liquidity and economic trends within the country.
