Less cash in circulation

POSTED: 01/4/13 1:20 PM

St. Maarten – The basic amount of banknotes and coins in circulation and the current account assets from the commercial banks with the Central Bank of Curaçao and St. Maarten decreased in November of last year with 110.8 million guilders. This is due to a net decrease of the current account balance from the commercial banks of 117.8 million guilders. This decrease is largely due to the net purchase of foreign currency with the Central Bank and the increase of the obligatory reserve, according to the bank’s abridged balance sheet.

The Central Bank continued its tight monetary policy in November. The percentage of the obligatory reserve, the most important monetary instrument, was increased with 1.00 percent point to 13.75 percent to moderate the growth in the private credit loans and to push back the surplus liquidity in the banking. Due to increasing the percentage of the obligatory reserve the outstanding amount on obligatory reserves increased with 52.8 million guilders.

The entry ‘Claims on banks’ on the assets side of the balance sheet increased with 53.9 million guilders due to the fact that the Central Bank granted a current account credit to a commercial bank – also in the month November. The entry ‘Deposits of non-residents’ on the liabilities side of the balance decreased with 33.6 million guilders, mainly due to international transactions from a commercial bank on Bonaire. Together with the net purchase of foreign currency by the commercial banks, these transactions led to a decrease in the entry ‘Foreign Currency’ on the assets side of the balance sheet (147.6 million guilders).

 

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