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SATURDAY, AUGUST 2, 1980
JUNE MONEY SUPPLY AND FINANCIAL STATISTICS
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THE MONEY SUPPLY AND FINANCIAL STATISTICS FOR JUNE 1980 ARE PUBLISHED TODAY (SATURDAY). THE RELATIVELY LARGE INCREASES IN THE MONEY SUPPLY AND IN TOTAL CREDIT TO THE ECONOMY ARE PRESUMABLY PARTIALLY ACCOUNTED FOR BY THE EXTREMELY ACTIVE STOCK MARKET IN THE LAST 10 DAYS OF JUNE. ANOTHER FACTOR IN THE MONEY SUPPLY EXPANSION WAS THE HALF-YEARLY CREDITING OF INTEREST ON SAVINGS DEPOSITS: THIS WAS QUITE SUBSTANTIAL, WITH HIGH RATES OF INTEREST BEING PAID ON SAVINGS DEPOSITS FOR MUCH OF THE FIRST SIX MONTHS OF THE YEAR.
THERE WAS A FURTHER LARGE INFLOW OF FUNDS INTO HONG KONG DURING JUNE, POSSIBLY FOR STOCK MARKET INVESTMENT, WHICH ALSO CONTRIBUTED TO THE RISE IN THE MONEY SUPPLY.
THE DETAILED FIGURES FOR JUNE 1980, AND COMPARISONS WITH PREVIOUS MONTHS, ARE SET OUT IN TABLE 1. TABLE 2 SETS OUT SOME FIGURES FROM THE QUARTERLY ANALYSIS OF LOANS AND ADVANCES IN HONG KONG BY SECTOR.
MONEY SUPPLY
THE MONEY SUPPLY ON THE NARROWEST DEFINITION, M1 (NOTES AND COINS WITH THE PUBLIC, PLUS DEMAND DEPOSITS, OTHER THAN FROM BANKS AND DEPOSIT-TAKING COMPANIES, WITH LICENSED BANKS) ROSE BY 8.6 PER CENT IN JUNE, AFTER RISING BY 4.5 PER CENT IN MAY. DEMAND DEPOSITS ROSE SHARPLY IN THE LAST 10 DAYS OF JUNE, PRESUMABLY AT LEAST PARTIALLY REFLECTING THE HIGH LEVEL OF STOCK MARKET ACTIVITY IN THAT PERIOD.
M2 (M1 PLUS SAVINGS AND TIME DEPOSITS, OTHER THAN FROM BANKS AND DTC'S, WITH LICENSED BANKS) ROSE BY 9.3 PER CENT IN JUNE, WELL UP FROM A 5.1 PER CENT INCREASE IN MAY, AN EXPANSION IN THE LEVEL OF SAVINGS DEPOSITS, AGAIN MAINLY IN THE LAST 10 DAYS OF JUNE, IS ALSO LIKELY TO REFLECT STOCK MARKET ACTIVITY, AS WELL AS THE CREDITING OF HALF-YEARLY INTEREST TO DEPÓSITORS.
M3 (M2 PLUS PUBLIC DEPOSITS WITH DEPOSIT-TAKING COMPANIES) ROSE BY 6.5 PER CENT IN JUNE, UP FROM AN INCREASE OF 3.6 PER CENT IN MAY, DESPITE A FURTHER SLIGHT FALL IN DEPOSITS WITH DEPOSIT-TAKING COMPANIES. IN THE SECOND QUARTER, M3 ROSE BY 11.7 PER CENT.
CREDIT TO THE ECONOMY
TOTAL LOANS IN HONG KONG ROSE BY 5.4 PER CENT IN JUNE, FROM A 2.2 PER CENT RISE IN MAY, PARTLY REFLECTING BORROWINGS TO FINANCE STOCK MARKET INVESTMENT DURING THE MONTH. IN THE SECOND QUARTER OF THE YEAR, TOTAL LOANS IN HONG KONG ROSE BY 11.9 PER CENT, AGAINST A 13.9 PER CENT RISE IN THE FIRST QUARTER.
/BANK LOANS