The evolution of the annual rate of growth of M3 was characterised by an upward trend from May 2020 (7.8%) to September 2020 (10.6%). This trend halted in October when the rate declined by 0.8 percentage point from the previous month to 9.8%. It was irregularly volatile at around 10.3% in the following four months, reaching 11.1% in February 2021. It started to fall moderately in February and stood at 8.3% in September 2021 (down by 1.1 percentage points compared to August 2021). It remained at this level in January 2021. As a result of financial transactions, M3 increased by CZK 11.7 billion month on month (up by CZK 437.3 billion year on year), reaching CZK 5,716.7 billion.
Chart 1 - Contributions to annual M3 growth (%)
The annual rate of growth of loans to the private sector, which are the most important counterpart of M3, increased from 6.5% in September to 7.3% in October. The annual growth rate of loans to non-financial corporations, a major component of this indicator, declined almost continuously from April 2020 (4.9% in March 2020) to January 2021 (-0.7%). It was irregularly volatile at around 0.1% in the following five months. It started to grow in July 2021, reaching 5.8% in October, up by 1.4 percentage points compared to the previous month. The annual growth rate of loans to households, another major component, has been growing slightly since June 2020 (6.2% in May 2020). It amounted to 9.6% in October 2021, up by 0.3 percentage point month on month.
Chart 2 - Contributions to annual growth in loans to private sector (%)
Note:
Monetary aggregates comprise the monetary liabilities of monetary financial institutions to non-MFI Czech residents except central government. The narrow monetary aggregate M1 includes currency in circulation (excluding cash at banks' cash desks) and overnight deposits. The intermediate monetary aggregate M2 comprises M1, deposits redeemable at notice of up to three months and deposits with a maturity of up to two years. The broad monetary aggregate M3 comprises M2, money market fund shares/units, debt securities with a maturity of up to two years and repurchase agreements.
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Ceska Narodni Banka published this content on 30 November 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 30 November 2021 09:30:02 UTC.
