SEOUL, Jan. 16 (Xinhua) -- South Korea's money supply growth hit the highest in 44 months in November after the policy rate cuts, central bank data showed Thursday.
The M2, called broad money, expanded 7.7 percent in November from a year earlier, marking the fastest growth in three years and eight months since March 2016, according to the Bank of Korea (BOK).
The rapid increase came as the BOK slashed its benchmark interest rate from 1.50 percent to a record low of 1.25 percent in October. The central bank lowered the target rate by 25 basis points in July.
The M1, dubbed narrow money, was up 7.0 percent in November, after rising 5.3 percent in the previous month.
The M1 refers to the currency in circulation, demand deposit, transferable savings deposit equivalent to cash. The M2 adds money market fund, time deposit and financial products that mature in less than two years to M1.
The liquidity of financial institutions, called Lf, expanded 8.4 percent in the cited period. The year-over-year increase of liquidity aggregate, the broadest measure of money supply, was 8.1 percent.
The Lf includes financial products with a maturity of more than two years and liquidity at insurers and brokerages along with M2. The liquidity aggregate adds state and corporate bonds to the Lf. Enditem
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