South Korea’s money supply expanded at the fastest clip in almost five years in April following a surprise rate cut in March and a continued current surplus streak, central bank data showed Wednesday.
The M2 surged 9 percent on-year to 2,149.2 trillion won ($1,915.8 billion) in April, quickening from an 8.3 percent increase in the previous month, according to the Bank of Korea.
The on-year growth is the fastest since July 2010 when the M2 expanded by 9.3 percent.
From a month earlier, the country’s M2 rose 1 percent on a seasonally adjusted basis, slightly picking up from 0.9 percent growth in March.
M2 includes currency in circulation, as well as types of deposits with a maturity of less than two years at lenders and non-banking financial institutions. It does not cover those with a maturity of two years or longer, government bonds or corporate bonds.
The latest reading comes on the heels of a quarter percentage point rate cut in March that is seen to have increased market liquidity.
The country’s current account, the broadest measure of cross-border trade, has also been extending its surplus streak to a record-matching 38 months in April.
In a separate statement, the central bank forecast M2 to have increased in the low-9 percent range in May in tandem with household lending growth. (Yonhap)
