REPUBLIKA.CO.ID, JAKARTA -- Bank Indonesia (BI) has said that the growth of money in circulation (M2) in November 2013 ran slower compared with the M2 growth in October 2013, the central bank said on its official web site on Wednesday.

Based on the BI web site, the circulation growth of M2 money was registered at Rp3,614.4 trillion in November 2013, up 12.7 percent year on year, but the growth was slower if compared with the M2 growth a month earlier whose increase was higher at 13 percent year on year.

The slow growth is also observable if it is counted using a fixed currency exchange rate to eliminate the rupiah depreciation value, namely from 10.5 percent year on year in October 2013 to 9.3 percent year on year in November 2013.

Based on its components, the slow M2 growth was chiefly caused by declining in the M1 growth (money in circulation in narrower sense) from 10.5 percent in the previous month to 8.6 percent in November 2013.

In the meantime, the growth of the other component, namely quasi money, increased from 13.4 percent year on year in October to 13.5 percent year on year in November 2013.

The factor that influenced the decline in the growth of the M2 money was the drop in the receivables at companies and households (the private sector) in the form of credits. The credit provided by the banking sector in November 2013 grew by 21.9 percent year on year, which was slower than the growth in October at 22.1 percent year on year.

The central bank is of the view that the decline in the growth of money in the M2 category and of credit in November 2013 was in line with the slow pace of domestic economic activities and the increase in the banking lending rates.

The interest rates of three and six month time deposits in November 2013 were respectively recorded at 7.3 percent and 7.1 percent, up if compared with the interest rates in the previous month, which were respectively recorded at 7 percent and 6.8 percent.

BI also said that the banking lending rate was also still showing an upward trend from 12.3 percent in October 2013 to 12.4 percent in November 2013.

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