HARARE, September 1 (The Source) – Zimbabwe’s annual broad money supply growth rate increased from 12.5 percent in May 2016, to 13.1 percent in June 2016 driven by an increase in demand deposits, latest data from the central bank have shown.
Broad money supply (M3), a measure of the money in circulation which includes physical currency and demand deposits, stood at $5, 1 billion in June 2016 just shy of the $5 billion recorded in May 2016.
“The annual growth in money supply was driven by increases in demand deposits which grew 28.7 percent, over 30- day deposits and savings deposits which grew 13.9 percent and 10.3 percent respectively,” said the central bank in latest monthly economic report.
Partially offsetting the increases was a decline of 24.1 percent in short term deposits.
Demand deposits constituted 54.6 percent of total deposits followed by over 30-days deposits at 19.1 percent; under 30-days deposits 13.2 percent and savings deposits, 12.9 percent. Bond coins accounted for 0.2 percent.
Total banking sector credit registered an annual growth of 13.3 percent in June 2016, down from 16.4 percent in May 2016.
On a monthly basis, domestic credit increased by 1.6 percent, from $5, 6 billion in May 2016 to $5, 7 billion.
Year-on-year, credit to the private sector declined by 4.5 percent to $ 3, 5 billion in June 2016, from $3, 7 billion in June 2015.
Month-on-month, credit to the private sector also decreased by 0.7 percent in June 2016.
“On a sectoral basis, households took up 23 percent, agriculture 18.3 percent, distribution 13 percent, services 17.1 percent, manufacturing 15.6 percent, mining 5.2 percent, transport and communications 2.8 percent and construction 1.4 percent,” said the central bank.