This increase was driven by M1, which grew by 18.5 percent (yoy), higher than the previous month's growth of 15.8 percent (yoy).
"This is in line with the increasing circulation of currency in the community and rupiah demand deposits," Executive Director of the Communication Department of Bank Indonesia (BI) Erwin Haryono noted in his statement in Jakarta, Friday.
Meanwhile, the quasi-money component slowed down, from 11.1 percent yoy to 10.5 percent yoy in December 2020.
Securities apart from stocks also recorded a further contraction to minus 10.6 percent yoy, from minus 5.8 percent yoy in November 2020.
Haryono expounded that based on the influencing factors, the increase in M2 in December 2020 was owing to net foreign assets and an increase in the government’s financial expansion.
This is mirrored in the growth in net foreign assets in December 2020 of 13.6 percent yoy, higher than the 10.3-percent yoy growth in November 2020.
Net claims on the Central Government also rose, from 66.5 percent yoy to 66.9 percent yoy in December 2020.
Meanwhile, credit growth contracted further to minus 2.7 percent yoy, from minus 1.7 percent yoy in November 2020. Related news: Money supply increased to Rp6,780.8 trillion in October 2020: BI
Related news: Indonesia's money supply rose 10.5 percent in July 2020: BI
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