First jump in Eurozone lending in three years
Lending in the Eurozone rose for the first time in three years, the European Central Bank said yesterday, marking a new chapter in the bloc's recovery after the launch of a massive money-printing programme.
Lending across the 19 countries in the currency union rose by 0.1pc on the year in March, giving hope that Europe, whose economy has trailed that of the US, may be turning the corner.
Although the rise is small, it seals a recent upward trend and is a significant improvement after three years of nearly uninterrupted, and often sharp, monthly falls.
"The lending figures suggests that the ECB policy is starting to turn the credit cycle and that's good news for growth," said James Knightley, an economist with ING. The swing is better than the flat result many analysts had predicted.
"Credit is more readily available and demand is returning," he said. "If we can now get investment moving, that will generate real momentum."
A return to confidence among banks is particularly important in Europe, where businesses traditionally rely on them for finance rather than tapping capital markets as their peers in the United States do.
But problems exist. Many business owners, for instance, especially in crisis-hit countries, continue to find it difficult to borrow and there are big differences in the cost of credit between nations.