South Korea's money supply continued to grow quickly in October on increased loans to households and firms amid the coronavirus pandemic, central bank data showed Tuesday.

The country's M2 stood at 3,150.5 trillion won ($2.87 trillion) as of end-October, up 1.1 percent, or 34.7 trillion won, from September, according to preliminary data by the Bank of Korea (BOK).

October's gain marked the second-highest monthly growth since May this year, when M2 grew by 35.4 trillion won, according to the BOK. 

From a year earlier, M2 surged 9.7 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 at a fast pace in October as households and companies took out large bank loans amid the prolonged economic impact from the COVID-19 outbreak and low interest rates.

Funds held by households and nonprofit organizations grew by 21.1 trillion won in October from the previous month, with those held by businesses rising by 10.7 trillion won.

South Korea's corporate earnings and household income have taken a big hit from the coronavirus outbreak that has sent consumer spending and exports, the country's twin growth engines, tumbling.

The BOK conducted two rate cuts in less than three months after the country confirmed its first coronavirus case on Jan. 20, sending the policy rate to a record low of 0.5 percent. (Yonhap)