Money Supply in economy expands by 16% YoY in May’20

July 9, 2020 (MLN): The total money supply circulating within the economy in May 2020 has been recorded at around Rs.24.196 trillion, according to provisional accounts on Monetary Aggregates for the month, maintained by the State Bank of Pakistan.

The money circulating within the economy until last month was Rs.23.58 trillion while until the corresponding month of last year, the figure was Rs.20.8 trillion. This means that money supply has increased 16% over the year and only 3% over the month.

Having broken down the overall money supply in broad categories, the SBP data shows that a total of Rs.6.36 trillion were circulated as notes while Rs.10.29 trillion accounted for transferable deposits which comprise all deposits that are exchangeable on demand at par without penalty/restriction.

The amount circulated as notes which has been high in Pakistan relative to other developed and emerging economies, rose by over Rs 1.34 trillion or 27% over the year.

Apart from this, other deposits constituted Rs.3.2 trillion in May’20, up by 12%, YoY. Other deposits represent all claims other than transferable deposits in national or foreign currency that are represented by evidence of deposits. Similarly, coins circulated surged from Rs.8.6 billion in May 2019 to Rs.9.12 billion in May 2020.

Furthermore, Rs.269.43 billion worth of deposits were held with post offices while National Saving Schemes held Rs.4.05 trillion, marking a growth of 8% YoY from Rs.3.75 trillion.

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