Euro zone lending beginning to stabilise
European Central Bank figures published yesterday showed company loans rose 11bn euros (9.3bn) in the month, following a 10bn euro drop in October, leaving them 0.1 per cent weaker than the same time a year ago.
"This is a welcome, limited step in the right direction. This raises hopes that euro zone banks may be becoming more willing to lend to what they perceive to be less risky businesses," said IHS Global Insight economist Howard Archer.
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Hide Ad"It also hints that there has been a limited increase in companies looking to borrow to finance investment and business plans in reaction to recent improved activity."
Loans to the private sector overall were up two per cent over the year, more than economists' expectations of a 1.5 per cent improvement and up on the 1.5 per cent gain recorded in October.
Data for lending to home buyers, seen by economists as a potential leading indicator of lending trends, was less promising, however, with mortgage lending slowing and lending to households overall also slowing.
The annual decline in the pace of mortgage lending was the first since September 2009.
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Hide AdThe data also pointed to the absence of significant price pressures in the 16-nation region, bolstering economists' expectations that the ECB will not raise official interest rates until late next year at the earliest.