Taiwan's Money Supply Indicator M2 Up 6.24% for New High in April

The annual growth of Taiwan's two major money supply indicators—M1B and M2—stood at 9.1% and 6.24%, respectively in April, with the latter hitting a new high since August of 2011, according to the central bank, which  attributes the growth to net inflow of foreign funds and obvious increase in loans and investment by domestic banks.

M1B is usually seen as a pillar for the local stock market. In April the outstanding value of stock trading accounts increased NT$24.7 billion (US$823.33 million) from a month earlier to hit a record high of NT$1.38 trillion (US$46 billion) and that of the passbook savings deposits rose NT$38.2 billion (US$1.27 billion) to NT$12.35 trillion (US$411.66 billion), both of which fueled capital needed in the stock market.

In the first fourth months the annual growth of M1B averaged 9.13% and that of M2 at 5.93%, keeping an uptrend in money supply.

In the same period the annual growth of consumer price index (CPI) posted at 1.01% with food price growing 0.91%. (JL)