SEOUL, Feb. 17 (Yonhap) — South Korea’s money supply continued to grow in December last year, as loans to households and firms increased amid the coronavirus pandemic, central bank data showed Wednesday.

The country’s M2 stood at 3,191.3 trillion won (US$2.9 trillion) as of end-December, up 0.4 percent from a month earlier, according to preliminary data by the Bank of Korea (BOK).

From a year earlier, M2 surged 9.8 percent, the BOK said.

A key economic indicator closely monitored by authorities, M2 is a measure of the money supply that counts cash, demand deposits and other near money that is easily convertible to cash.

The BOK said M2 kept rising in December last year as households and companies took out large bank loans to fight the pandemic.

Funds held by households and nonprofit organizations grew by 8.9 trillion won in December from the previous month, with those held by businesses rising by 5.4 trillion won.

Last year, the BOK conducted two rate cuts in less than three months after South Korea confirmed its first coronavirus case, sending the policy rate to a record low of 0.5 percent.