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Analysed by currency, HK dollar loans increased by 0.6% during the month while foreign currency loans declined by 1.8%. As HK dollar loans grew slower than HK dollar deposits, the HK dollar loan-to-deposit ratio fell from 107.6% at end- August to 106.2% at end-September.
Quarterly analysis of Loans for use in Hong Kong by major economic sector
Loans for use in Hong Kong grew by a more moderate 2% in the September quarter, compared to 5.1% in the June quarter, largely attributable to the weaker performance in trade financing.
Along with the slow growth in external trade, loans for trade financing declined by 4.1%, while loans to the manufacturing sector slowed from 3.6% growth in the June quarter to 1.2% growth in the September quarter.
On the other hand, loans to most other sectors expanded healthily. In particular, loans for residential mortgages and for building, construction and property development grew further, reflecting the continued buoyancy in the residential property market.
Loans for wholesale and retail trade increased by 3.9%, in line with the gradual pick-up in consumer spending.
Money supply
With currency held by the public rising by 0.8% and HK dollar demand deposits by 9.6%, HK$M1 recorded a 5.9% increase in September. Compared to a year earlier, HK$M) rose by 12.2%.
The pick-up in transaction demand for money was in line with the gradual revival of retail sales and favourable performance in asset markets. HK$M2 and HK$M3 both increased by 1.8% in September, having risen by 1.2% in August.
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