Manila: Bank lending and domestic liquidity recorded double-digit growth in July, data from the Bangko Sentral ng Pilipinas (BSP) showed.

According to Philippines News Agency, in a report released Tuesday, the central bank stated that loans from universal and commercial banks (U/KBs) grew at a pace of 10.4 percent in July, up from 9.8 percent in June. The BSP noted that this faster growth reflects sustained lending to both businesses and consumers.

Outstanding loans issued by U/KBs reached PHP14.98 trillion. Loans for business activities saw an acceleration to 9.8 percent from 9.2 percent in June, attributed to increased lending to key sectors such as electricity, gas, steam, and air-conditioning supply, wholesale and retail trade, repair of motor vehicles and motorcycles, financial and insurance activities, and information and communication.

On the consumer side, loans to residents slowed to 17.1 percent in July from 17.8 percent in June. This deceleration was due to a softening in the growth of credit and motor vehicle loans, attributed to weak consumer confidence. The BSP emphasized its monitoring of bank loans as they are a crucial transmission channel of monetary policy.

Simultaneously, domestic liquidity rose by 10.3 percent to PHP20.5 trillion, continuing to support economic activity. M3, a broad measure of money supply including currency in circulation, bank deposits, and other financial assets easily convertible to cash, saw growth driven by borrowings from both private and public sectors.

According to the BSP, bank lending continued to channel funds to production sectors and households. Additionally, the national government's issuance of debt securities and withdrawal of deposits from the BSP and banks to finance spending played a role in supporting domestic liquidity growth. The central bank affirmed its commitment to ensuring that domestic liquidity conditions remain aligned with price and financial stability objectives.