Euro area money supply growth slows a tad more than expected in May

Money supply growth in the Eurozone slowed a bit more quickly than anticipated last month, but economists said the data continued to point towards "solid" growth.

According to the European Central Bank, the year-on-year rate of growth in money supply, as measured by the M3 monetary aggregate, dipped from 9.2% to 8.4%.

Economists had forecast a rate of 8.4%.

So-called 'narrow' money supply growth meanwhile slowed from 12.3% for May to 11.6% in April.

On the asset side of the euro area's balance sheet, the rate of growth of credit to the private sector slipped from 4.1% to 3.6%.

Credit to general government meanwhile was growing at a clip of 5.9%, down from 6.7% in the month before.

Commenting on Friday's numbers, Claus Vistesen, chief euro area economist at Pantheon Macroeconomics, said: "The slowdown in M1 isn’t a huge concern at this point.

"Base effects from the initial pandemic response last year was always going to drag growth down in 2021, and the underlying pace is still robust, pointing to solid growth in economic activity upon reopening."