The monetary situation in the Kingdom continues to show the thriving state of the Saudi economy. The year 2013 started off with a lower monetary base (M0) for the month of January as it recorded a decline of SR 11.3 billion to settle at SR 339.28 billion after it reached SR 350.6 billion in December 2012. Even though M0 gained 13.3 percent Y/Y, the M/M contraction was mainly due to deposits with SAMA (Saudi Arabian Monetary Agency), as banks opted to utilize their funds by withdrawing nearly SR 12.9 billion to accommodate credit expansions and customer withdrawals, which reduced total banks' reserves, according to a report by the National Commercial Bank (NCB).
However, currency outside banks increased to SR 134.1 billion; an increase of 10.8 percent Y/Y. Additionally, cash in vault reached SR 20.2 billion, an annual rise of 11.1 percent during the same month.
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