Economic liquidity measured by broad money (M2) accelerated from 5.1% (yoy) in September 2016 to 7.5% (yoy) in October 2016. Narrow money (M1) and quasi-money were the main contributors, accelerating respectively from 5.9% (yoy) and 5.0% (yoy) in September 2016 to 10.3% (yoy) and 6.8% (yoy).
M2 growth accelerated on the back of stronger credit growth in the banking sector. In October 2016, the position of disbursed loans stood at Rp4,246.6 trillion as growth accelerated from 6.4% (yoy) the month earlier to 7.4% (yoy), primarily on the working capital loans and investment loans.
The banking sector continued to lower its lending rates throughout October 2016 in line with the loose monetary policy stance maintained by Bank Indonesia. The average lending rate was observed to decline from 12.23% to 12.21%. Meanwhile, commercial banks lowered interest rates on 1, 3, 6 and 12-month term deposits from 6.63%, 6.84%, 7.31% and 7.66% in September to 6.46%, 6.75%, 7.02% and 7.39%.
Complete information and statistics concerning money supply and related analyses are available here.