Monthly Monetary Report

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

Summary

• In November, the broadest monetary aggregate in pesos (M3) grew 1.6%, accumulating an increase of 28.3% in the last twelve months. For its part, the broader private monetary aggregate (private M3) exhibited a monthly growth of 1.3% and a year-on-year variation of 30.1%. Time deposits in pesos from the private sector continued to stand out among the components of private M3. In the month they grew 2.7%, with increases in both deposits of less than $1 million (1.9%) and placements belonging to the wholesale segment (3.3%). In year-on-year terms, the increase in fixed-term deposits stood at 39.2%, remaining at a historically high level. This allowed them to continue gaining share within the private M3, reaching a weight of 31.5%, 4.2 p.p. above the proportion they represented 2 years ago.

• Favored by public policies aimed at promoting productive credit, in the first eleven months of 2013, loans in pesos to the private sector stand out as the main growth factor of private M3. In November, loans in pesos to the private sector showed a growth of 2.6% ($11,330 million), similar to that of the previous month. Thus, the year-on-year rate of change continued at high levels, at around 36%.

• Regarding the “Credit Line for Productive Investment” (LCIP), preliminary data indicate that since it was launched (mid-2012) and until October, credits for more than $45,000 million were granted, of which about 58% was assigned to MSMEs. By the end of the third stage, the productive loans agreed will have reached $55,000 million, of which $30,000 million will have been directed to relatively smaller companies.

• The satisfactory results of this credit policy aimed at the productive sector, and which pays special attention to the provision of funds to MSMEs, were reflected in their growing participation in the financing of legal entities. In the last half of 2013, MSMEs obtained approximately 40% of the new loans granted to companies, when this ratio reached 27% in mid-2012, prior to the implementation of the LCIP.

• The broad liquidity ratio of financial institutions (defined as the sum of the current accounts of financial institutions, cash in pesos, net passes with the Central Bank and holdings of LEBAC and NOBAC; as a percentage of deposits in pesos) was maintained with respect to the previous month, standing at 31.9%.

• Among short-term passive interest rates, in the wholesale segment, the BADLAR of private banks – interest rate for deposits of $1 million and more than 30-35 days of term – averaged 19.1%; while, in the retail segment, the weighted average of the interest rate paid for fixed-term deposits in pesos of the private sector up to $100 thousand stood at 15.5%. Meanwhile, among the active interest rates, the one corresponding to advances granted to companies, for more than $10 million and up to 7 days of term, averaged 20.2%.