(MENAFN) South Korea’s money supply continued its upward trajectory for the fifth consecutive month, fueled by persistent market anticipation of further policy rate reductions, according to central bank figures released Wednesday.

The Bank of Korea (BOK) reported that the seasonally adjusted broad money supply, known as M2, increased by 1.3 percent in August, reaching 4,400.2 trillion won ($3.09 trillion), marking steady growth since April.

The central bank has already trimmed its benchmark interest rate by 25 basis points twice this year—in February and May—bringing it down to 2.50 percent, following two similar cuts in October and November of last year.

Expectations for additional rate cuts later this year remain high among investors and analysts.

Meanwhile, the narrower money supply measure, M1—which includes currency in circulation, demand deposits, and transferable savings deposits—rose 1.5 percent in August, up from 1.2 percent growth in July.

By definition, M2 encompasses M1 plus money market funds, time deposits, and other financial products maturing within two years.

Financial institutions’ liquidity expanded by 1.1 percent in August, while the broadest liquidity aggregate recorded a 0.6 percent increase.

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