ANALYSIS AND COMMENTS MARKET SUMMARY


FINANCIAL MARKET SUMMARY

Selected financial instruments
		Outstanding at end	Transactions during	Other changes during	Outstanding at end
		Sep Qtr 2009	Dec Qtr 2009	Dec Qtr 2009	Dec Qtr 2009
		$b	$b	$b	$b
Currency and deposits
	Currency	52.4	2.9	-	55.3
	Transferable deposits	430.4	-8.4	-0.2	421.8
	Other deposits	956.9	25.7	-1.7	981.0
Short term debt securities
	Bills of exchange	149.2	-2.9	-	146.3
	One name paper	394.1	-16.0	-0.9	377.2
Long term debt securities
	Bonds, etc.	1 294.4	68.4	-10.8	1 352.0
Derivatives
	Derivatives	338.2	-46.7	-27.8	263.7
Loans and placements
	Short term	282.1	16.5	-3.3	295.4
	Long term	2 168.1	1.6	-1.1	2 168.7
Shares and other equity
	Listed	1 324.7	28.5	24.6	1 377.9
	Unlisted	1 214.7	36.5	5.1	1 256.3
Insurance technical reserves
	Reserves of pension funds and life offices	1 140.0	24.6	8.3	1 172.8
	General insurance prepayments and reserves	74.6	-0.6	-	74.0
- nil or rounded to zero (including null cells)

Currency liabilities increased to $55.3b at the end of December 2009, following transactions of $2.9b during the quarter compared with transactions of $0.6b for September 2009. Deposit liabilities increased to $1,402.8b at the end of December 2009, following transactions of $17.3b during the quarter compared with transactions of -$4.7b in the previous quarter. The major contributors were the rest of the world and banks which accepted $17.2b and $10.0b respectively. This was offset by withdrawals from other depository corporations of $8.4b and central bank of $1.4b.

Short term debt security liabilities decreased to $523.5b at the end of December 2009, following net redemptions of $18.9b. Total long term debt security liabilities increased to $1,352.0b at the end of December 2009, following net issuance of $68.4b during the quarter. Banks issued bonds worth net $50.3b, of which $13.2b were issued in the domestic market and $37.1b issued offshore. National general government had net issuance of $15.1b, of which $15.0b were issued in the domestic market. Rest of the world had net issuance of $11.8b, of which $6.3b was issued domestically and $5.4 was issued offshore. These increases were partially offset by securitisers which had net redemptions of $17.6b of which $14.7b were redeemed domestically and $2.9 were redeemed offshore.

The value of derivative contracts on issue at the end of December 2009 decreased by $74.5b to $263.7b. Components of the decrease were net settlements of $46.7b and valuation decreases of $27.8b. Major contributors to net settlements were banks $20.7b, rest of the world $12.1b and other depository corporations $8.2b.

Loan liabilities rose to $2,464.1b at the end of December 2009, following transactions of $18.1b during the quarter. Households borrowed $28.2b and Banks borrowed $14.7b. The major offset to these increases was by other private non-financial corporations repaying $29.9b.

The listed share market increased by $53.2b to $1,377.9b at the end of December 2009, with net issuance of $28.5b and valuation increases of $24.6b. Other private non-financial corporations issued $18.9b and banks issued $6.9b. The value of the unlisted share market increased by $41.6b to $1,256.3b at the end of December 2009, with net issuance of $36.5b and valuation increases of $5.1b. Rest of the world issued $22.8b and other private non-financial corporations issued $10.3b during the quarter.

At the end of December 2009, the reserves of life offices and pension funds were $1,172.8b following transactions during the quarter of $24.6b and valuation increases $8.3b. General insurance prepayments and reserves were $74.0b.