Pick up in credit growth extends - deposit growth weak
Deposit and credit growth
Please see my earlier blog on this subject.
The tables below give the picture over the last one year. Let's look at it using another time frame also.
In the last two years (Sept. over Sept., 2016-17 and 2017-18) covering demonetisation and GST, deposit growth fell to 8.4% from the earlier two years (Sept. over Sept., 2014-15 and 2016-17) number of 11.3% - a very sharp fall.
Credit grow in the last two years (Sept. over Sept., 2016-17 and 2017-18) covering demonetisation and GST is now about the same level as compared to the earlier two years (Sept. over Sept., 2014-15 and 2016-17) number of 10%. So although there is a pick-up in credit growth in the last year, as seen in the table below, it is over a two year period just a return to normalcy.
Money Supply
Instead of looking at just the last year, as in the case of bank deposits and credits, let's look at a longer time frame.
In the last two years (Sept. over Sept., 2016-17 and 2017-18) covering demonetisation and GST, money supply growth fell to 8 % from the earlier two years (Sept. over Sept., 2014-15 and 2016-17) number of 11.5% - a sharp fall. Normally a central bank, including the RBI, targets to grow money supply in the same order as the nominal growth of the economy.
Deposit and credit growth
Please see my earlier blog on this subject.
The tables below give the picture over the last one year. Let's look at it using another time frame also.
In the last two years (Sept. over Sept., 2016-17 and 2017-18) covering demonetisation and GST, deposit growth fell to 8.4% from the earlier two years (Sept. over Sept., 2014-15 and 2016-17) number of 11.3% - a very sharp fall.
Credit grow in the last two years (Sept. over Sept., 2016-17 and 2017-18) covering demonetisation and GST is now about the same level as compared to the earlier two years (Sept. over Sept., 2014-15 and 2016-17) number of 10%. So although there is a pick-up in credit growth in the last year, as seen in the table below, it is over a two year period just a return to normalcy.
Instead of looking at just the last year, as in the case of bank deposits and credits, let's look at a longer time frame.
In the last two years (Sept. over Sept., 2016-17 and 2017-18) covering demonetisation and GST, money supply growth fell to 8 % from the earlier two years (Sept. over Sept., 2014-15 and 2016-17) number of 11.5% - a sharp fall. Normally a central bank, including the RBI, targets to grow money supply in the same order as the nominal growth of the economy.
Reserve Money
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