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Within HK$ deposits, demand deposits fell by 1.1%, while savings deposits rose by 4.1%. HK$ time deposits grew by 2.4% in the month, reversing the fall of 2.6% in November.

The rise in foreign currency deposits was attributable to a 1.3% increase in US$ deposits during the month, as non-US$ foreign currency deposits barely grew.

Foreign currency swap deposits fell by a further 3.9% in December, leading to a cumulative reduction of 52.1% since the peak of November 1994.

Loans and Advances

Total outstanding loans and advances rose by 0.2% in December, after a 1% increase in November. The slight increase was accounted for by a 0.6% increase in domestic loans which outweighed a 0.1% decline in loans for use outside Hong Kong. Analysed by currency, HK$ loans rose by 0.3% in the month, while foreign currency loans rose by 0.1%. As HK$ deposits grew faster than HK$ loans, the HK$ loan-to- deposit ratio declined to 105.7% in December from 108% in November.

Quarterly Analysis of Loans for Use in Hong Kong by Major Economic Sector

Loans for domestic use accelerated, growing by 2.3% in the December quarter. This increase was in part contributed by the loans for purchasing residential properties and, to a lesser extent, by the increases in loans for wholesale & retail trade and manufacturing. Loans for trade financing also rebounded slightly during the quarter, while loans for transport and transport equipment fell.

Money Supply

HK$MI rose by 0.8% in December. This was due to a seasonal increase in currency held by the public, notwithstanding the decrease in demand deposits. HK$M2 and HK$M3 both increased by 2.5% in December, compared with the declines of 2% and 1.9% respectively in November.