FRANKFURT (AFP) – Depressed demand for loans in the eurozone is continuing to stabilise, data published by the European Central Bank showed on Thursday.
The ECB compiles monthly statistics on loans to the private sector, which are a key gauge of economic health and particularly closely watched at the moment since chronic weakness in credit is seen as the main hurdle to a more sustained recovery in the single currency area.
The ECB’s latest data showed that in October loans to the private sector in the euro area fell by 1.1 per cent year-on-year, a slightly slower rate of decline than the 1.2-per-cent decline seen in September.
At the same time, the ECB calculated that growth of the overall eurozone money supply – a barometer for future inflation – stood at 2.5 per cent, the same rate of change as in September.
The EB regards M3 money supply as a barometer for future inflation.
The two sets of data provided some room for encouragement, analysts said.
“The very gradual upswing in the eurozone’s credit cycle continued in October,” said Berenberg Bank economist Christian Schulz.