Euro area money supply growth edged higher in November, with bank lending to households and companies also increasing, according to data released by the European Central Bank on Friday.
The ECB said the annual growth rate of the broad monetary aggregate M3 rose to 3% in November 2025 from 2.8% in October.
The three-month average through November stood at 2.9%. At the same time, lending to the private sector continued to expand, with adjusted loans to households growing at an annual rate of 2.9% and loans to non-financial corporations rising 3.1%, both slightly higher than in the previous month.
Growth in the narrower monetary aggregate M1, which includes currency in circulation and overnight deposits, slowed to 5% in November from 5.2% in October.
Short-term deposits other than overnight deposits, measured as M2 minus M1, declined at an annual rate of 0.8%, compared with 1.8% decline in October. Marketable instruments, defined as M3 minus M2, increased at an annual rate of 1.6%, up from 1.4%.
M1 remained the largest contributor to overall money supply growth, adding 3.2 percentage points to the annual growth rate of M3 in November, slightly down from 3.3 percentage points in October.
Short-term deposits other than overnight deposits contributed -0.3 percentage points, compared with -0.5 percentage points a month earlier, while marketable instruments contributed 0.1 percentage points, unchanged from October.
Among deposit-holding sectors, household deposits grew at an annual rate of 3.3% in November, up from 3% in October. Deposits placed by non-financial corporations increased by 3.4%, unchanged from the previous month. Deposits held by investment funds other than money market funds slowed sharply, with annual growth easing to 0.5% from 2.7% in October.
The counterparts of M3 showed higher contributions from several balance sheet items. Claims on the private sector contributed 3.2 percentage points to M3 growth in November, up from 2.7 percentage points in October. Net external assets contributed 1.9 percentage points, compared with 1.7 percentage points a month earlier. Claims on general government contributed 0.3 percentage points, up from 0.2 percentage points. Longer-term liabilities reduced M3 growth by -1.2 percentage points, while remaining counterparts subtracted -1.1 percentage points.
Total claims on euro area residents increased at an annual rate of 2.6% in November, compared with 2.3% in October. Claims on general government rose by 0.7%, up from 0.6%, while claims on the private sector increased to 3.4% from 2.9%.
Adjusted loans to the private sector, which are corrected for loan transfers and notional cash pooling, grew at an annual rate of 3.4% in November, compared with 3% in October.
Within that total, lending to households rose by 2.9%, up from 2.8% a month earlier, while lending to non-financial corporations increased to 3.1% from 2.9%.
Separate reporting on euro zone bank lending published the same day showed lending to households and non-financial corporations growing at annual rates of 2.9% and 3.1% respectively in November, both higher than in October, aligning with the ECB’s loan data.
All figures are adjusted for seasonal and end-of-month calendar effects unless otherwise stated. Data may be revised in subsequent releases.
Source: Investing