Money supply continues to rise in July on short-term deposits

South Korea's money supply increased in July, according to central bank data released on Tuesday. The country's M2, a key indicator of the money supply, averaged 4,225.6 trillion won (US$3.51 trillion) in July, marking a 0.3% rise or 12.7 trillion won compared to the previous month. This upward trend has been consistent since November.

M2 encompasses cash, demand deposits, and other easily convertible financial instruments. The Bank of Korea (BOK) reported that short-term deposits and money trusts with maturities under two years grew in July. Within sectors, liquidity held by nonfinancial corporations surged by 20.6 trillion won, while liquidity held by households and nonprofit organizations dropped by 11.6 trillion won. Liquidity within financial institutions experienced a decline of 5.7 trillion won.