Eurozone April private sector lending picks up: ECB

31st May 2010, Comments 0 comments

Bank lending to the private sector in the eurozone picked up in April, climbing back into positive territory compared to the level in April last year, the European Central Bank said on Monday.

Lending increased by 0.1 percent from the level in April 2009, a bank spokesman said, reversing the decline of 0.2 percent over 12 months in March.

Growth of the ECB's M3 money supply indicator, which measures cash, deposits and various other financial items, declined by 0.1 percent in April, the same as in March.

Lending and money supply data illustrate consumer demand and overall activity in an economy.

Falling figures point to lower demand, which normally means inflation will ease and allow the ECB to cut interest rates. However, rates are already at a record low of one percent and are not expected to be cut further.

The 16-nation eurozone emerged from recession last year but its recovery is uncertain, and it must now tackle the sovereign debt crisis in Greece and other peripheral eurozone countries.

© 2010 AFP

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