Monthly Monetary Report

Monthly report on the evolution of the monetary base, international reserves and foreign exchange market.

1. Synthesis

• During April, the total means of payment (M2) reached an average balance of $199,350 million, presenting an increase in the month of 0.9% ($1,730 million) and registering a year-on-year variation of 19.9%. The largest aggregate in pesos, M3, registered an increase of 1.9% during the month (19.6% YoY), while private M3 showed a growth of 1.4% (20.4% YoY).

• Total private deposits in pesos registered a growth of 2.5% in the month. Demand loans increased 2.8%. Meanwhile, fixed-term deposits continued to grow at a similar rate to that recorded since the beginning of the year (2% monthly), increasing mainly in the wholesale segment (more than $1 million).

• The increase in deposits in pesos resulted in an increase in both loans granted to the private sector and the assets that make up ample liquidity (sum of cash in banks, current account in the BCRA, net passes with the BCRA and holdings of LEBACs and NOBACs). The broad liquidity ratio was 39.8% of total deposits in pesos, 0.9 p.p. above March, an increase that took place mainly through the growth of banks’ holdings of LEBAC and NOBAC.

• Loans in pesos to the private sector showed great dynamism in April, with commercial lines and consumer financing standing out. Thus, the average monthly balance stood at $125,610 million, showing an increase of 2.8% ($3,445 million) compared to the previous month. Likewise, in year-on-year terms they registered a growth of 14.8%. Among commercial credits, the behavior of current account advances stood out, which registered an increase of 5.2% ($850 million), while those instrumented through documents advanced 2.8% in the month ($650 million). In the segment aimed at financing consumption, credit card financing registered a growth of 4.1% ($780 million), while personal loans advanced 2.3% ($750 million) in the month.

• In a context of sustained growth in private sector term loans, passive interest rates continued with the slight downward bias observed since the beginning of the year. The monthly average of the interest rate paid by private banks in the wholesale bracket (of $1 million and more) and for deposits of up to 35 days (BADLAR) stood at 9.25%, with a decrease of 0.2 p.p. compared to the average recorded in March. For its part, the monthly average interest rate paid by private banks to retail placements (up to $100,000), for the same term, also fell 0.2 p.p., standing at 8.7%.

• Interest rates charged on loans to companies fell again, reaching average single-digit values in some segments. For their part, those destined for family consumption also registered decreases, although their levels remained high with respect to the cost of funding. According to preliminary information for Capital and GBA, interest rates on personal loans fell 0.6 p.p. and reached a level of around 31.1%. On the other hand, the average monthly rate in February, the latest information available, of credit card financing throughout the country stood at 30.2%, with a decrease of 0.9 p.p. compared to January.