J.L.M. Campuzano (AEB) | The European Central Bank released the data of the M3 and its counterparts in the euro area until May. The intermediate liquidity objective maintains its annual evolution stable by 4.8%, supported by a strong increase of 7.2% in cash and demand deposits. The rest of its components, such as deposits and market instruments, maintain marginal growth.
The evolution of credit, the main counterpart of the M3, grew by 2%. But with a very different behavior from its components: credit to the public sector grew by 0.6% compared to 2.5% of the increase in credit to the private sector. Specifically, loans to families and companies maintain an increase of 2.7%, which contrasts with the decrease of 2.2% in loans from financial institutions to public administrations. Deposits in European banks increased by 5.2%, with even greater growth in the case of deposits of families and companies. Government deposits went up 9.1%.
In Spain for the first time since the end of last year we see an increase in the balance of loans from banks to families and companies. The total growth of financing from both sectors (loans and wholesale financing) increased by 1.5%. Deposits of families in Spanish banks grew by 6.1% in May, unchanged from the most recent increase rates. They already account for 57.2% of the total. The set of deposits in credit institutions grew by 2.5% .
The data show the solid supply of financing by European banks, with increases above the nominal growth of the European economy. It is important that our authorities encourage the demand for sustainable and solvent financing with reforms and supply policies.