ANALYSIS AND COMMENTS MARKET SUMMARY


FINANCIAL MARKET SUMMARY

Selected financial instruments
		Outstanding at end	Transactions during	Other changes during	Outstanding at end
		Dec Qtr 2013	Mar Qtr 2014	Mar Qtr 2014	Mar Qtr 2014
		$b	$b	$b	$b
Currency and deposits
	Currency	67.5	-2.7	-	64.8
	Transferable deposits	632.7	6.5	1.6	640.7
	Other deposits	1 276.9	16.4	-5.5	1 287.8
Short term debt securities
	Bills of exchange	103.3	-4.2	-	99.0
	One name paper	335.4	-2.6	-2.4	330.4
Long term debt securities
	Bonds, etc.	1 911.7	37.2	-11.0	1 938.0
Derivatives
	Derivatives	426.1	-89.6	51.0	387.5
Loans and placements
	Short term	267.3	15.5	-0.7	282.1
	Long term	2 831.2	35.9	-1.9	2 865.1
Shares and other equity
	Listed	1 523.7	6.5	10.4	1 540.6
	Unlisted	2 224.9	12.9	7.9	2 245.8
Insurance technical reserves
	Reserves of pension funds and life offices	1 823.7	30.0	6.9	1 860.6
	General insurance prepayments and reserves	98.7	-0.7	-	97.9
- nil or rounded to zero (including null cells)

Currency liabilities decreased to $64.8b at the end of March 2014, following transactions of -$2.7b during the quarter compared with transactions of $4.7b for December 2013. Deposit liabilities increased to $1928.5b at the end of March 2014, following transactions of $22.9b during the quarter compared with transactions of $61.1b in the previous quarter. The major contributors to the change in levels were banks which increased by $11.1b and the central bank which increased by $11.2b.

Short term debt security liabilities decreased to $429.4b at the end of the March quarter 2014, following maturities of $6.8b. Total bonds liabilities increased to $1,938.0b at the end of March 2014, following net issuance of $37.2b during the quarter. The national general government issued bonds worth $25.1b, of which $24.8b was issued domestically and $0.3b was issued offshore. Securitisers issued bonds worth $11.7b, of which $12.5b was issued domestically and $0.8b matured offshore. Central borrowing authorities issued bonds worth $7.2b, of which $8.0b was issued domestically and $0.7b matured offshore. These increases in issuance were partially offset by other private non-financial corporations net maturities of $4.6b, of which $0.7b was issued domestically and $5.3b matured offshore.

The value of derivative contracts on issue at the end of March 2014 decreased by $38.6b to $387.5b. Net settlements were $89.6b for the quarter of which the major contributors were banks -$33.7b, rest of the world -$24.3b and other depository corporations -$16.0b.

Loan liabilities rose to $3,147.2b at the end of March 2014, following transactions of $51.4b during the quarter. Households borrowed $21.9b, rest of world borrowed $12.7b and other private non-financial corporations borrowed $8.9b.

The listed share market increased by $16.9b to $1,540.6b at the end of March 2014, with net issuances of $6.5b and valuation increases of $10.4b. The major contributors to the issuances were other private non-financial corporations which issued $3.7b, private non-financial investment funds which issued $1.9b, non-money market investment funds $0.4b and banks which issued $0.1b. The unlisted share market increased by $20.9b to $2,245.8b at the end of March 2014, with net issuances of $12.9b and valuation increases of $8.0b. The major contributors to the issuances were non-money market investment funds which issued $8.6b and rest of world which issued $6.2b.

At the end of March 2014, the insurance technical reserves of life offices and pension funds were $1,860.6b following transactions during the quarter of $29.9b and valuation increases of $7.0b. General insurance prepayments and reserves were $97.9b following transactions during the quarter of -$0.7b.