Arab Today, arab today eurozone credit demand on steady decline
Last Updated : GMT 00:51:25
Arab Today, arab today
Arab Today, arab today

Eurozone credit demand on steady decline

Arab Today, arab today

Arab Today, arab today Eurozone credit demand on steady decline

Frankfurt - AFP

Demand for credit in the 17-country eurozone remains weak, even though tensions seem to be easing in the region's financial markets, data published by the European Central bank showed on Monday. Eurozone bank loans to the private sector declined by 0.7 percent in December compared with the same month in 2011 after shrinking by 0.8 percent in November, the ECB calculated in regular monthly data. A breakdown of the lending data showed that the growth rate of loans to private households appears to be slowly starting to recover, edging up 0.5 percent in December compared with 0.4 percent in November. By contrast, loans to non-financial corporations contracted by 2.3 percent last month, after already shrinking by 1.9 percent the previous month. The central bank has long argued that falling loans to the private sector reflects weak demand for credit rather than tight lending conditions, given the pessimistic view of eurozone growth prospects and heightened risk aversion amid the crisis. And analysts believe an upturn is unlikely to be seen any time soon as it will take time for recent more positive economic data to feed through into higher borrowing in the non-financial sector. "An upturn is unlikely until the economy gathers momentum once more. Our empirical studies suggest that to a large extent, the low level of lending is due to meagre demand," said Commerzbank economist Michael Schubert. UniCredit analyst Marco Valli said that lending to households was showing "signs stabilisation or modest recovery, while corporate lending -- usually the last aggregate to turn, because it lags the business cycle -- remains under pressure." But "if, as we expect, the next months will see a further improvement of both growth indicators and banks' funding conditions, the lending cycle is likely to embark on a moderate recovery sometime in the second half of 2013," Valli argued. "The eurozone may be heading for a recovery, but not a credit-fuelled one according to December monetary data," said Berenberg Bank economist Christian Schulz. IHS Global Insight economist Howard Archer was similarly cautious. "Mounting evidence from surveys that eurozone economic activity bottomed out around last October has yet to be reflected in increased lending to the eurozone private sector," he said. "It remains to be seen if the recent overall strengthening in eurozone business and consumer confidence from late-2012 lows leads any time soon to an appreciable pick-up in demand for credit from the private sector and whether banks believe the economic situation and outlook is improving sufficiently to make it significantly more attractive and less risky to lend," he said. Marie Diron of Ernst & Young Eurozone Forecast said the "much more positive sentiment about the eurozone future that has prevailed in financial markets so far this year will probably take some time to materialise in greater credit availability and economic growth. "However, we think that during 2013, with a much more secure economic environment than last year, banks will start easing credit standards somewhat and companies will be more willing to borrow to invest in the eurozone," she said. The ECB also published eurozone money supply data, which suggest that growth in the money supply -- a key guide to future inflation -- slowed last month. Growth in the M3 indicator, which measures the amount of money in circulation, grew by 3.3 percent in December, compared with 3.8 percent in November. The ECB regards the M3 figure as a key guide to inflation pressures and uses it to set interest rates accordingly.

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

Arab Today, arab today eurozone credit demand on steady decline Arab Today, arab today eurozone credit demand on steady decline

 



Arab Today, arab today
Arab Today, arab today Nohan Seyam designs beautiful accessories

GMT 20:02 2017 Tuesday ,21 February

Nohan Seyam designs beautiful accessories
Arab Today, arab today Tourism shows signs of recovery

GMT 09:59 2017 Monday ,20 February

Tourism shows signs of recovery
Arab Today, arab today Sarah Belamesh designs antiques of "ceramic"

GMT 19:45 2017 Monday ,20 February

Sarah Belamesh designs antiques of "ceramic"
Arab Today, arab today 11 family members dead in rebel push

GMT 07:57 2017 Tuesday ,21 February

11 family members dead in rebel push
Arab Today, arab today To probe sexual harassment claims

GMT 10:08 2017 Tuesday ,21 February

To probe sexual harassment claims
View News in Arabic - Business: مصارف
Arab Today, arab today
Arab Today, arab today
Arab Today, arab today 57 monkeys carrying 'invasive' genes

GMT 16:00 2017 Tuesday ,21 February

57 monkeys carrying 'invasive' genes
Arab Today, arab today 63-Year-Old Woman Delivers Baby

GMT 12:35 2017 Tuesday ,21 February

63-Year-Old Woman Delivers Baby
Arab Today, arab today Small ponds have outsized impact

GMT 15:53 2017 Tuesday ,21 February

Small ponds have outsized impact
Arab Today, arab today Pluto's unruly moons

GMT 06:31 2015 Thursday ,04 June

Pluto's unruly moons
Arab Today, arab today Nissan enhances sales in most markets

GMT 14:08 2017 Monday ,20 February

Nissan enhances sales in most markets
Arab Today, arab today Competes Sweden and Germans by S90

GMT 22:36 2017 Thursday ,16 February

Competes Sweden and Germans by S90
Arab Today, arab today Ahmed Fahmy stresses he did not ignore singing

GMT 06:34 2017 Sunday ,19 February

Ahmed Fahmy stresses he did not ignore singing
Arab Today, arab today London to tax old cars

GMT 14:06 2017 Friday ,17 February

London to tax old cars

GMT 21:11 2017 Saturday ,18 February

Egypt to hold first session of Arab film festival

GMT 06:50 2017 Wednesday ,15 February

Tragic fluctuations of Bakhtiari's life revealed

GMT 12:22 2017 Monday ,20 February

Kanye West puts hijab-wearing model

GMT 20:41 2017 Wednesday ,15 February

Teach monkeys to recognize themselves in mirror

GMT 23:29 2017 Thursday ,16 February

Home built on sand castles-style costs $8m

GMT 14:51 2017 Monday ,20 February

Ways to acquire presentation skills

GMT 19:16 2017 Friday ,17 February

Aziz House ready to host the tourists

GMT 13:12 2015 Saturday ,09 May

Sheikh Sultan opens Sharjah Centre

GMT 12:39 2017 Monday ,20 February

newest smartphone another winner for Huawei

GMT 16:08 2017 Wednesday ,15 February

Shawsh reveals her collection "Jewelry of dreams"
Arab Today, arab today
Arab Today, arab today
 
 Arab Today Facebook,arab today facebook  Arab Today Twitter,arab today twitter Arab Today Rss,arab today rss  Arab Today Youtube,arab today youtube  Arab Today Youtube,arab today youtube
arabstoday arabstoday arabstoday arabstoday
arabstoday arabstoday arabstoday
arabstoday
بناية النخيل - رأس النبع _ خلف السفارة الفرنسية _بيروت - لبنان
arabstoday, Arabstoday, Arabstoday