ECB: Eurozone Loans to Private Sector Still Contracting
Loans to the private sector in the euro area -- a gauge of economic health -- are still contracting, but at a slower rate than before, European Central Bank data showed on Wednesday.
The volume of loans to private businesses and households declined by 1.8 percent in April, after falling by 2.2 percent the previous month, the ECB said in a statement.
The data appear to confirm a tentative recovery slowly emerging in credit demand in the 18 countries which share the euro, where the long and deep financial crisis caused credit to dry up almost completely.
At the same time, the overall eurozone money supply grew by just 0.8 percent in April, down from growth of 1.0 percent in March.
This could prove a headache for the ECB, which regards M3 money supply as a barometer for future inflation, since area-wide inflation is currently much lower than the ECB would wish.
Source: Agence France Presse
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