At end-May, broad money (M2) stood at ROL 199,829 billion, up 0.6 percent month-on-month in nominal terms (a drop of 1.1 percent in real terms). The increase in broad money was the result of the diverging development of its components.
Net foreign assets grew by 1.6 percent to ROL 112,515 billion owing to the 1.3 percent increase under "Foreign Exchange" (USD 52.6 million) and the insignificant rise under "Gold"1) ."Foreign Exchange" component expanded due mainly to the launching on the domestic market of foreign-exchange-denominated government securities by the Ministry of Public Finance and the net foreign exchange purchases of the National Bank of Romania from the forex market.
Net domestic assets edged 0.6 percent lower to ROL 87,314 billion, with domestic credit increasing by 0.5 percent to ROL 122,713 billion and the negative balance of other assets widening by ROL 1,132 billion.
In May, non-government credit leapt 2.2 percent (0.5 percent growth in real terms against April and 6.6 percent for the first five months of the year) to ROL 90,381 billion, due to the 3.1 percent rise in credit in lei and the 0.2 drop in foreign-exchange credit (1.7 percent growth when expressed in lei). Government credit, net, declined by 4.2 percent to ROL 32,332 billion, due mainly to the launching of foreign-exchange denominated bonds by the Ministry of Public Finance on the domestic market2) and the increase in T-bills outstanding with banks following bank-client operations.
Narrow money (M1) posted a 0.8 percent decrease to ROL 41,751 billion, as a result of the 1.4 percent drop in currency outside banks to ROL 25,457 billion along with the 0.2 percent climb in demand deposits to ROL 16,293 billion.
Quasi-money inched up one percent to ROL 158,078 billion. Household savings grew 1.9 percent to ROL 50,697 billion (accounting for 25.4 percent of broad money), amid the persistence of households' propensity towards holding ROL-denominated government securities, which expanded 7.1 percent to ROL 13,465 billion. Household forex deposits expressed in US dollars moved ahead 0.5 percent, while household foreign-exchange-denominated government securities (equivalent to USD 140.4 million) advanced 11.6 percent.
Corporate deposits in lei lowered 0.5 percent to ROL 19,476 billion. Time deposits dropped 1.8 percent to ROL 10,784 billion, certificates of deposits moved 2.1 percent higher to ROL 4,509 billion, while restricted deposits were little unchanged at ROL 4,183 billion.
Residents' forex deposits (including households) expressed in lei rose by 0.8 percent to ROL 87,905 billion, equivalent to a decrease by 1.1 percent to USD 3,057 million, when expressed in foreign currency.
At end-May, the non-bank sector held ROL-denominated government securities worth ROL 23,316 billion (up 6.2 percent over April). Foreign-exchange-denominated government securities outstanding with the non-bank sector jumped 28.4 percent month-on-month to the equivalent of USD 224.4 million. At the end of May, foreign-exchange-denominated government securities held by non-residents remained unchanged over the previous month at the equivalent of USD 0.7 million, according to the data reported by banks which acted on behalf of the government.
1) Gold is recognised in the Monetary Balance Sheet at book value, which is updated each December. The value of the gold stock held by the NBR went up USD 48.8 million month-on-month in May as a result of the increase in the world price of gold from USD 262.20 per ounce to USD 276.65 per ounce in May 2001.
2) The foreign exchange amounts raised as borrowings from the domestic market are deposited by the Ministry of Public Finance with the NBR, thus diminishing the government's debtor position to banks.