Economic liquidity, or broad money supply (M2), showed stable growth in April 2018. Bank Indonesia recorded M2 at Rp 5,408.6 trillion, a 7.4% year-on-year (YoY) increase compared to April 2017, slightly lower than the 7.5% YoY growth in March 2018. This slowdown in M2 growth was influenced by the narrow money supply (M1) component, which grew by 10.2% YoY, down from 11.9% YoY the previous month. Meanwhile, quasi money experienced growth of 6.5% YoY, compared to 6.2% YoY the previous month.
Based on influencing factors, money supply growth was driven by government financial expansion and accelerated credit growth. Net growth to the Central Government in April this year grew by 8.6% YoY compared to April last year, while in March it only grew by 5.9% YoY.
Bank credit disbursement was recorded at Rp 4,807.5 trillion, or 8.9% YoY growth, higher than the previous month's 8.5% YoY growth. However, M2 growth was constrained by the slowdown in net foreign assets, which only grew by 6.4% YoY, lower than the previous month's 9.3% YoY growth. Meanwhile, interest rates on credit and time deposits decreased in line with the continued transmission of Bank Indonesia's policy interest rate cuts.