FRIDAY, JULY 29, 1994
THE GROWTH
OF TIME DEPOSITS MODERATED TO 2.4% AFTER A RAPID
GROWTH OF 5.5% IN MAY.
THE GROWTH OF FOREIGN CURRENCY SWAP DEPOSITS SLOWED DOWN ΤΟ 3.2% DURING THE MONTH COMPARED WITH 7.5% IN MAY AS THE INTEREST RATE DIFFERENTIAL BETWEEN HONG KONG DOLLAR DEPOSITS AND SWAP DEPOSITS NARROWED AFTER THE RISE IN DEPOSIT RATES GOVERNED BY THE HONG KONG ASSOCIATION OF BANKS IN LATE MAY.
AGAINST THE PROGRESSIVE FALL IN THE INTEREST RATES OF SOME MAJOR NON-U.S. DOLLAR FOREIGN CURRENCIES AND THE RISING HONG KONG DOLLAR AND U.S. DOLLAR INTEREST RATES, SHIFTING OF NON-U.S. DOLLAR FOREIGN CURRENCY DEPOSITS TO HONG KONG DOLLAR AND U.S. DOLLAR DEPOSITS CONTINUED.
NON-U.S. DOLLAR FOREIGN CURRENCY DEPOSITS FELL BY 0.4% IN JUNE. YEAR-ON-YEAR, SUCH DEPOSITS DECREASED DRASTICALLY BY 10.7%. THE DECLINE WOULD HAVE BEEN MORE SERIOUS IF THE EXCHANGE RATE APPRECIATION EFFECT OF SOME MAJOR FOREIGN CURRENCIES, SUCH AS JAPANESE YEN AND DEUTSCHEMARK, WERE DISCOUNTED.
GROWTH OF U.S. DOLLAR DEPOSITS PICKED UP 1.6% IN JUNE AND BY 11.0% OVER A YEAR EARLIER.
HK$M1 WAS UP 0.9% IN JUNE. NOTWITHSTANDING THIS SMALL INCREASE, THE YEAR-ON-YEAR GROWTH OF HK$M1 PROGRESSIVELY SLOWED DOWN FROM A HIGH OF 33.4% IN FEBRUARY TO 6.2% IN JUNE AFTER SUCCESSIVE DECLINE IN DEMAND DEPOSITS AND CASH IN CIRCULATION IN THE PREVIOUS MONTHS.
HK$M3 GREW BY 1.8%
IN JUNE AND ITS YEAR-ON-YEAR GROWTH ACCELERATED SLIGHTLY TO 25.8%. HK$M2 REGISTERED SIMILAR MOVEMENTS.
THE MOVEMENT OF TOTAL M1 FOLLOWED CLOSELY THAT OF HK$M1 AND INCREASED YEAR-ON-YEAR BY 6.1%.
OWING TO THE DECLINE IN NON-U.S. FOREIGN CURRENCY DEPOSITS, THE GROWTH OF TOTAL M2 AND TOTAL M3 WERE MUCH SLOWER THAN THEIR HONG KONG DOLLAR COUNTERPARTS. THEIR ANNUAL GROWTH WERE 12.7% AND 13.3% RESPECTIVELY.
TOTAL OUTSTANDING LOANS IN HONG KONG PICKED UP STRONGLY BY 4.0% IN JUNE COMPARED WITH A 0.3% DECLINE IN MAY. THE LARGE INCREASE WAS MAINLY ATTRIBUTABLE TO A 5.6% GROWTH IN FOREIGN CURRENCY LOANS.
HONG KONG DOLLAR LOANS INCREASED BY 1.0% IN JUNE, SLOWER THAN THE 1.4% GROWTH IN HONG KONG DOLLAR DEPOSITS. AS RESULT, THE HONG KONG DOLLAR LOAN-TO-DEPOSIT RATIO DECLINED SLIGHTLY TO 113.5%.
THE GRADUAL DECLINE OF THIS RATIO SINCE MARCH 1994 INDICATES THAT THE BANKING SECTOR HAS BEEN MORE PRUDENT IN THEIR LENDINGS RECENTLY.
FURTHER TREND DEVELOPMENT ALONG THIS DIRECTION CAN BE A CONSTRAINT FACTOR ON FUTURE HONG KONG DOLLAR MONEY SUPPLY GROWTH.
LOANS TO FINANCE VISIBLE TRADE OF HONG KONG CONTINUED WITH A SOLID GROWTH OF 3.9% IN JUNE, FOLLOWING A 4.1% INCREASE IN MAY. LOANS FOR USE OUTSIDE HONG KONG ALSO RECORDED STRONG GROWTH OF 6.9% IN JUNE, REFLECTING MAINLY THE GROWTH IN FOREIGN CURRENCY LOANS.
/DURING THE