M1B, M2 categories positive: central bank

The M1B category, which encompasses all physical capital and demand deposits, grew 4.91 percent in December, while the M2 category, which encompasses all of M1B plus savings deposits and physical capital market shares, grew 3.67 percent for that month.

The CBC said the annual growth for M1B was at 3.45 percent, while M2 grew 4.17 percent annually.

The central bank releases a monthly report which also includes a category called M1A. This encompasses the currency in circulation with checking accounts and passbook deposits. The bank's monetary policy is largely based on the M1B and M2 categories, the CBC said.

The bank said it uses the M2 category as a major indicator for commodity prices.

The CBC said the M1B is heavily tied to financial activities. The bank said M1B is often seen as the stock market's financial indicator.

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