SEOUL, May 13 (Yonhap) -- South Korea's money supply grew at the fastest rate in more than four years in March, central bank data showed Wednesday, apparently on a massive financial support package designed to minimize the economic fallout from the new coronavirus pandemic.
The country's M2 came to 2,982.9 trillion won (US$2.42 trillion) as of end-March, up 0.9 percent from a month before, according to preliminary data from the Bank of Korea (BOK).
From a year earlier, the reading marks a 8.4 percent spike, the sharpest on-year gain since October 2015 when M2 jumped 8.8 percent on-year, according to the BOK.
M2 is a measure of the money supply that counts the currency in circulation, including bank debentures and deposits with a maturity of less than two years, along with stock investments. It is a key economic indicator closely monitored by the authorities.
The sharp increase was largely attributed to a rise in the money held by businesses, which added 30.4 trillion won from a month earlier.
"This is the largest (on-month) gain since such data began to be available in December 2001," the BOK said.
"A large amount of money has been funneled to savings accounts on efforts by businesses to secure liquidity and the government's financial support measures amid the COVID-19 outbreak," it added.
The BOK earlier said fresh loans extended by local banks to companies amounted to 18.7 trillion won in March, spiking from a 3.6 trillion won increase the month before.
The rise in corporate loans further accelerated in April, jumping to a record high of 27.9 trillion won.
Funds held by local households, including nonprofit organizations, added 1.5 trillion won from a month earlier in March, marking a slowdown from a 10 trillion-won gain in February.
Funds held by financial institutions, on the other hand, dipped 4.9 trillion won.
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