Taiwan's Money Supply Indicators on Downtrend in February 2014

The annual growth of Taiwan's two major money supply indicators—M1B and M2—stood at 8.63% and 5.61%, respectively in February, both down month-on-month, according to the Central Bank.

In the first two months of this year the annual growth of M1B stood at 9.27%, a new high of its kind in three years; and that of M2 at 5.79%.

Y. T. Chen, deputy director general at the Central Bank's Economic Research Department, says that the growth of M1B usually reflects capital demand in the stock market and the annual growth of M1B is likely to reach a high level in the first quarter of this year, but may slow down in the second contingent on the performance of the stock market.

In February the outstanding value of stock trading accounts showed a monthly rise of NT$23.4 billion (US$780 million) to NT$1.3162 trillion (US$43.87 billion), a new high in four months. The expanding value in stock trading accounts implies an active stock market and the average daily trading value in the market rose to a high of NT$93.4 billion (US$3.113 billion) in the first two months as a result. (JL)