EUROZONE DATA: Lending Growth Accelerates Again, Impulse Maintained
Eurozone lending growth to the private sector accelerated a touch further in April, setting fresh highs since mid-2023 at 2.7% Y/Y or 2.2% Y/Y when adjusting for sales & securitization. Germany continues to lag in credit impulse metrics, not helping by a continuation of what has been a particularly tepid trend in lending to non-financial corporates.
- Sticking to a sales & securitization adjusted basis, lending to non-financial corporates (NFCs) increased 2.6% Y/Y in April after an upward revised 2.4% (initial 2.3) for a fresh high since Jun 2023.
- Lending to households meanwhile increased 1.9% Y/Y in April after 1.7% for its fastest since May 2023. It’s an eight consecutive monthly acceleration for the Y/Y.
- France continues to see the fastest rate of lending to NFCs (3.4% Y/Y, +0.2pp) although Spain and Italy have extended their recovery, with Spain still accelerating strongly (2.3% Y/Y, +0.5pp) and Italy almost out of contraction territory (-0.6% Y/Y, +0.3pp). Germany, however, extends a lacklustre trend, at 0.7% Y/Y (+0.1pp) having averaged 0.6% since late 2023.
- Spain continues to lead the increase in lending to households in what has been an impressive turnaround (2.7% Y/Y, +0.1pp). Germany (1.4% Y/Y, +0.2pp) and Italy (1.4% Y/Y, +0.3pp) follow with France (0.8% Y/Y, +0.1pp) lagging in contrast to its more robust rate of lending to corporates.
- Despite the modest acceleration in credit growth, the Eurozone credit impulse metric of 3mth flows vs 3mths a year ago continued a broad plateauing so far in 2025. It sits around 2% GDP after a large swing from the -5 to -6% GDP seen in mid-2023 when credit growth started to slow abruptly - see top right chart.
- On this relative impulse basis, Italy leads (2.6% GDP), followed by France (2.4% GDP), Spain (2.2% GDP) and Germany lagging (0.9% GDP).
- Separately, Eurozone M3 money supply surprisingly re-accelerated back to 3.9% Y/Y (cons 3.7) in April after an upward revised 3.7% (initial 3.6%) in March and 3.9% in Feb. It averaged 5.0% Y/Y through 2019.
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