South Korea's money supply rose 0.7 percent on-month in December due mainly to an increase in savings boosted by rising interest rates and brisk exports, central bank data showed Thursday.

The country's M2, a key gauge of the money supply, stood at 3,613 trillion won ($3.02 trillion) on average in December, up 23.8 trillion won from a month earlier, according to the preliminary data from the Bank of Korea (BOK).

The growth rate slowed down in December compared with the previous month. From a year earlier, however, the money supply jumped 13.2 percent, the fastest since November 2008, the BOK said.

M2 is a measure of the money supply that counts cash, demand deposits and other easily convertible financial instruments.

The rise is attributable to increased deposits at financial institutions bolstered by higher interest rates, as well as state cash handouts amid the COVID-19 pandemic.

Rates on savings have been on the rise in tandem with the central bank's policy rate hikes in recent months as it seeks to tighten its loose monetary policy to tame inflation.

The growth in exports also drove up the corporate money supply, according to the BOK.

The country's outbound shipments hit a monthly high of $60.74 billion in December, the 14th consecutive month that exports have extended gains. (Yonhap)