Lower growth in money supply
Banking and financial markets
m2, The money supply M2, money, notes and coins, assetsFinancial indicators, Banking and financial markets

The money supply M2March 2008



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Lower growth in money supply

The twelve-month growth in total money supply fell from 14.7 per cent to 10.7 per cent to end-March, the lowest annual growth since March 2006.

Money supply (M2) - growth

The money supply amounted to NOK 1 429 billion at end-March, down from NOK 1 439 billion at end-February. The sharp decline in the annual growth to end-March may be a result of both the decline in March this year and the sharp growth in March 2007.

Slowdown in household money supply growth

At end-March more than half (NOK 742 billion) of the broad monetary aggregate was owned by households. The twelve-month growth in household money supply fell from 10.5 per cent to 9.2 per cent during March. Households have been the main contributor to annual growth in money supply for three consecutive months, accounting for about 45 per cent of the growth. For the time being the growth in household money supply is considerably lower than the growth in household gross debt (11.0 per cent), as shown by the credit indicator C2 . For more information on the financial position of households, see the financial accounts in the national accounts .

Declining growth also for non-financial enterprises

Non-financial enterprise money supply amounted to NOK 496 billion at end-March. The twelve-month growth was 7.1 per cent, down from 13.0 per cent to the previous month. The growth in enterprise money supply has not been lower since October 2004. The growth rate has been decreasing since December 2006, when it reached 35.5 per cent.

Monetary aggregates, growth (per cent)
  January 2008 February 2008 March 2008
M0 - 12 mth -8.7 -3.0 -3.9
M1 - 12 mth 10.8 9.4 6.0
M2 - 12 mth 16.0 14.7 10.7
M2 - 3 mth moving average 14.0 6.9  

Composition of money supply

The broad monetary aggregate M2 amounted to NOK 1 429 billion at end-March, of which the major part (89 per cent) consisted of bank deposits. In comparison, notes and coins only accounted for 3 per cent of the broad money. The rest of the broad money mainly consisted of shares in money market funds (7 per cent), while certificates of deposits accounted for 1 per cent.

The money supply (broad monetary aggregate) M2 consists of notes and coins, unrestricted bank deposits, certificates of deposit and units in money market funds owned by households, non-financial enterprises, municipalities and financial enterprises other than state lending institutions, banks and money market funds.