Market Liquidity Trends in April

Market liquidity experienced a slight increase in April, reversing the previous month's minor decline. This change was influenced by a mix of factors including adjustments in deposit interest rates and seasonal fiscal activities.

Understanding the Numbers

The broad money supply (M2) saw an increase to 4,235.08 trillion won, marking a 0.2% rise from March. Time deposits and installment savings notably increased, while demand deposits decreased due to corporate dividend payments and local government fiscal executions.

Expert Insights

Kim Min-woo from the Bank of Korea highlighted the impact of global trade disputes and domestic economic slowdown concerns on deposit interest rates, leading to shifts in where funds are allocated.

Sector-Specific Movements

Households and non-profit organizations slightly increased their funds, with a focus on time deposits, whereas companies leaned towards money market funds and beneficiary certificates. Meanwhile, other financial institutions saw a decrease in funds.

Looking at M1

The narrow money supply (M1) decreased by 0.6%, attributed to reductions in readily withdrawable savings and demand deposits, despite a slight year-on-year growth increase.