- Vitas Vasiliauskas, ECB Governing Council member
The Euro area's money supply growth eased more than expected in August, while the annual increase in private loans improved. The broad monetary aggregate M3, which is often an early indicator of future economic activity, rose 4.8% in the reported period from the last year, while markets forecasted the annual growth in money supply to remain unchanged at 5.3%. The narrower aggregate M1, which includes currency in circulation and overnight deposits, increased 11.4%, also weaker than the 12.2% growth seen in July.
Meanwhile, lending to the Euro zone households and corporations picked up slightly in August. According to the European Central Bank data, credit to the private sector advanced 1% annually, following a 0.7% rise a month ago, while loans to households increased 1% in the given month from last year, slightly faster than the 0.9% gain in July. At the same time, the annual growth rate of loans to non-financial corporations stood at 0.4% in August, after 0.3% in July. Although more recent figures indicated a solid pick up in lending, the ECB earlier this month said it revised its credit data down based on a new methodology.
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