Seoul, April 15 (IANS) South Korea’s money supply rose for the fourth consecutive month in February, as increases in savings deposits offset a decline in certificates of deposit (CDs), central bank data showed on Wednesday.

The country’s M2, a key gauge of the money supply, stood at an average of 4,114 trillion won ($2.79 trillion) in February, up 600 billion won from a month earlier, according to the preliminary data from the Bank of Korea (BOK), reports Yonhap News Agency.

The figure rebounded in November after declining the previous month and has since posted monthly gains.

M2 is a measure of the money supply that includes cash, demand deposits and other easily convertible financial instruments.

“Demand deposit-type savings rose as idle funds awaiting fiscal execution by local governments increased,” a BOK official said. “Marketable instruments, on the other hand, declined as the issuance of CDs fell due to worsening issuance conditions and reduced funding demand.”

By sector, liquidity increased by 9.4 trillion won among financial institutions and 5 trillion won among non-financial corporations, while liquidity held by households and nonprofit organizations fell by 10.5 trillion won, the data showed.

South Korean shares traded sharply higher late on Wednesday morning amid renewed optimism over a second round of possible US-Iran peace talks, with the benchmark index moving above the 6,000-point threshold.

The benchmark Korea Composite Stock Price Index (KOSPI) added 174.62 points, or 2.93 per cent, to 6,142.37 as of 11:20 a.m., hovering above 6,000 for the first time since Feb. 28, when the United States and Israel conducted air strikes on Iran.

Investors remain optimistic as Washington and Tehran may hold a second round of peace talks, following an initial round that ended without agreement.

Overnight, US stocks ended higher, with the Dow Jones Industrial Average rising 0.66 per cent and the Nasdaq Composite gaining 1.96 per cent.

–IANS

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