Μonetary developments: JULY 2000
13/09/2000 - Press Releases
In July 2000, the twelve-month rate of increase in the liquidity
indicator M4N, which is monitored by the Bank of Greece, remained at around the same level
as in June 2000. More specifically, M4N (which comprises currency in circulation, private
deposits in drachmas and foreign currency, as well as private holdings of repos, bank
bonds, money market fund units and government paper with a maturity of up to one year)
rose as follows:
12-month percentage changes |
May
2000 |
June
2000 |
July
2000 |
May-July 2000
average |
M4N |
8.0% (1),(2) |
9.3(1),(2) |
9.5%(1),(2) |
8.9%(1) |
Developments in the twelve-month growth rate of M4N in July 2000 are
associated with inflows of funds from abroad during that month, while provisional data
point to a small slowdown in credit expansion, which, however, is still remaining at high
levels. Besides, the average level of the twelve-month growth rate of M4N in the thre
months from May to July 2000 remained at 8.9 per cent, i.e. unchanged from its level in
the previous three month period from April to June 2000. It should be noted that the
reference range for M4N growth between the beginning and the end of the current year is
5-7 per cent.
Regarding the evolution of key M4N components, the twelve-month rate of
increase in currency in circulation decelerated (July 2000: 7.2 per cent, June 2000: 9.4
per cent). Private deposits (in drachmas and foreign currency) declined considerably in
July 2000 (-539 billion drachmas), leading to a slowdown in their twelve-month growth rate
(July 2000: 8.9 per cent, June 2000: 11.5 per cent). By contrast, a large rise was
observed in private holdings of repos (+618 billion drachmas), as repo yields remain
higher than those on deposits and Treasury bills. Furthermore, private holdings of money
market fund units increased (+119 billion drachmas) in July 2000, whereas private holdings
of government paper with a maturity of up to one year dropped by 156 billion drachmas. As
noted in previous press releases, what matters more is the evolution of total M4N rather
than changes in its individual components, as such changes largely reflect intra-M4N
shifts which do not affect total M4N.
Notes: (1)Provisional data.
(2)
Revised data.