Broad money or M3 recorded a stable annual growth of 3% in December, compared to 2.9% in November.

Bank Negara Malaysia in a statement, the expansion in M3, was driven mainly by the continued extension of credit to the private sector by the banking system.

The expansion, however, was partially offset by the continued growth of Islamic Investment accounts, as reflected in other influences, and decline in net foreign assets due to net capital outflows during the month.

The net financing to the private sector registered an annual growth of 5.5 % in December compared with 6.7 % in October.

The central bank, it was driven by the higher growth of loans extended by the banking system and development financial institutions (DFIS), amid some moderation in the growth of net outstanding corporate bonds during the month.

The outstanding business loans of the banking system recorded a higher annual growth of 5% compared with 4.6% in November, with growth driven by three on year expansion in most major sectors.

For households, outstanding loans of the banking system grew at a slightly slower pace of 5.3% in December compared with 5.4% in November, amid sustained growth in outstanding loans for the purchase of residential property.

Overall loan demand remained stable during the month with the level of loan applications moderating slightly from both businesses and households at rm29.3 billion compared with   rm29.9 billion in November.