Feeble lending still haunts euro area economies
29 November 2013 1:00am
LENDING to the private sector is still declining in the euro area, with the European Central Bank (ECB) confirming an even deeper collapse yesterday.
In the year to October, lending fell 2.1 per cent, the steepest drop this year. Loans to household were practically stagnant, up by 0.1 per cent in the same period. The currency union’s money supply also barely grew, with M3 up 1.4 per cent, short of the ECB’s 4.5 per cent target.
Despite such gloomy figures, the European Commission’s major measure of economic confidence, which was also announced yesterday, registered a more positive outlook on the region.
In the euro area, the economic sentiment indicator reached 98.5 this month, rising from 97.7 last month. Any score under 100 suggests economic confidence is below the long-term average level for the Eurozone.
“As a result of the credit crunch in parts of the periphery and held back by the problems in France, the Eurozone upswing will firm only gradually. But the confidence data support our call that the recovery will pick up some momentum over time,” said Holger Schmieding of Berenberg.
Capital Economics’ Ben May added: “We remain doubtful that the recovery will gain much momentum in the near term, suggesting that pressure on the ECB to take further action to support the economy will grow.”
In other news
Last night hundreds of people in Kent were woken by a 4.2 magnitude earthquake, which occurred just before 3am. [Read more]
Are the UK's new crop of MPs actually any good at social media? [Read more]
Newly re-elected Prime minister David Cameron will hold his first talks with European Union leaders today, as [Read more]
The Conservatives came to power on the back of an improving economy and with the promise of more improvement to [Read more]
Individual train operators say services are back on track as Network Rail blasts "deplorable" strike threat. [Read more]
Hewlett Packard (HP) announced disappointing earnings this afternoon, with revenues missing analysts expectations. [Read more]
In pictures: National waiters day kicks off with race around Hyde Park. [Read more]
Thomas Cook has revealed Georgios Chrysikopoulos, the general manager of the hotel in Corfu where children Christianne [Read more]
It's no surprise that we take to social media to vent our frustration when commuting, but a new report has shed [Read more]
Britain is losing billions each year from UK residents spending their money abroad on holidays, while overseas [Read more]
Waiting staff are out on protest today in central London over low pay and claims that Pizza Express management [Read more]
Sajid Javid’s new enterprise bill, announced this week in Bristol, is certainly well intentioned, but it's unlikely [Read more]
Just as Prime Minister David Cameron outlined his stance on tackling immigration, figures were published showing [Read more]
Bright-eyed graduates eager to train at one of London's leading law firms may have to stomach long hours, however [Read more]
With candidates lining up to take over Ed Miliband as the new Labour leader, divisions in the party are appearing [Read more]
There's no easy way to say this, but it sounds like there's going to be a global shortage of Prosecco this summer. [Read more]
Since early 2013, when Japan’s QE became imminent, its average quarterly annualised GDP growth rate has risen [Read more]