Japan's benchmark money supply measure rose 2.6 percent from a year earlier in April, the Bank of Japan (BOJ) said in a preliminary report on Friday.

According to the central bank's figures, the average daily balance of M2, which consists of cash in circulation, demand and time deposits as well as certificates of deposit at domestic banks, stood at 817.7 trillion yen (10.23 trillion U.S. dollars).

Japan's broader M3 money supply, which also covers deposits at postal banks and other financial institutions, meanwhile rose 2.3 percent from a year earlier to hit 1,122.8 trillion yen (about 14. 05 trillion U.S. dollars).

The balance of certificates of deposit rose 13 percent, logging the sharpest increase since February 2011 and suggesting a preference for chasing higher interest rates on deposits, a BOJ official noted. The balance was up for the second straight month.

Money supply or money stock, is the total amount of money available in an economy at a particular point in time and is usually defined as currency in circulation and demand deposits ( depositors' easily-accessed assets on the books of financial institutions).

Leading economists are quick to note the figure reflects the continuing trend of companies and individuals keeping cash on hand after the earthquake and tsunami last March.