30 Jan 2015
Auspicious credit figures allow positive prospects for EMU – Danske Bank
FXStreet (Edinburgh) - Pernille Nielsen, Senior Analyst at TD Securties, assessed the recent figures from the credit/money sector in the euro bloc.
Key Quotes
“M1 money supply increased 7.8% y/y in December up from 6.9% y/y in November.
In real terms it is a good leading indicator for economic activity and it now suggests GDP growth above 0.5% q/q at the beginning of H2”.
“Loans to the private sector increased for the first time since July 2012 (note it is the
figure adjusted for sales and securitisation)”.
“The progress should continue going forward as the latest bank lending survey showed that demand for credit and loans continued to increase. In our view, this is important for higher credit growth as supply-side constraints are limited after the ECB’s Asset Quality Review and Stress test revealed limited capital shortfalls”.
“Added to this the ECB’s QE programme should contribute to cheaper and more accessible credit to the private sector”.
“Overall, the progress in lending to the private sector supports our view of higher growth in the euro area. We expect GDP growth of 1.5% in 2015, which is above consensus of 1.1%”.
Key Quotes
“M1 money supply increased 7.8% y/y in December up from 6.9% y/y in November.
In real terms it is a good leading indicator for economic activity and it now suggests GDP growth above 0.5% q/q at the beginning of H2”.
“Loans to the private sector increased for the first time since July 2012 (note it is the
figure adjusted for sales and securitisation)”.
“The progress should continue going forward as the latest bank lending survey showed that demand for credit and loans continued to increase. In our view, this is important for higher credit growth as supply-side constraints are limited after the ECB’s Asset Quality Review and Stress test revealed limited capital shortfalls”.
“Added to this the ECB’s QE programme should contribute to cheaper and more accessible credit to the private sector”.
“Overall, the progress in lending to the private sector supports our view of higher growth in the euro area. We expect GDP growth of 1.5% in 2015, which is above consensus of 1.1%”.