S. Korea's money supply growth picks up in Oct.

SEOUL, Dec. 9 (Yonhap) -- South Korea's money supply grew at the fastest clip in six months in October as local banks increased their lending amid signs of an economic recovery, the central bank said Wednesday.

The country's M2, a narrower measure of its money supply, reached 1,551.3
trillion won (US$1.34 trillion) in October, up 10.5 percent from the previous
year, according to the Bank of Korea (BOK). October's growth marked the fastest
gain since April when the M2 expanded 10.6 percent.
The M2 covers currency in circulation and all types of deposits with maturity
less than two years at lenders and non-banking financial institutions, excluding
those at insurers and brokerage houses.
"In October, local banks made efforts to secure funds by raising deposit rates,
seeing a sharp rise in bank time deposits with maturity less than two years,"
said Kim Hwa-yong, a BOK official.
The BOK said in a separate statement that the M2 growth is estimated to have
slowed to around 9 percent in November mainly because stock investment by foreign
investors declined.
Meanwhile, the country's liquidity aggregate, the widest measure of the money
supply, expanded 10.6 percent in October from a year earlier, compared with a
10.3 percent on-year advance in September, the BOK said. October's growth marked
the fastest since March when it expanded an identical 10.6 percent.
The data comes a day before the BOK makes its monthly interest-rate decision. The
BOK is widely forecast to freeze the benchmark seven-day repo rate at a record
low of 2 percent for the 10th consecutive month. It slashed the rate by a
combined 3.25 percentage points between October 2008 and February in a bid to put
the brakes on a sharp economic free-fall.
sooyeon@yna.co.kr
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