Eurozone money supply declined for the third month in a row in September and lending to households and businesses posted weaker growth, the European Central Bank said Wednesday.
The broad money supply M3 declined 1.2 percent on a yearly basis in September after a 1.3 percent fall in August. This was the third consecutive annual decrease.
The narrow measure M1, which comprises currency in circulation and overnight deposits, decreased 9.9 percent but slower than August's 10.4 percent fall.
Data showed that adjusted loans to the private sector posted an annual growth of 0.3 percent, which was slower than the 0.7 percent gain in August.
Among the borrowing sectors, growth in adjusted loans to households eased to 0.8 percent from 1.0 percent. Likewise, adjusted loans to non-financial corporations climbed 0.2 percent, slower than the 0.7 percent rise in the previous month. The money and credit data confirms that the economy is probably contracting and will continue to do some in the coming months, Capital Economics' economist Jack Allen-Reynolds said. However, this will not prompt a change of approach from the ECB, the economist noted.
