EUROZONE DATA: Weak Credit Dynamics Remain Prevalent In July

Eurozone July money and lending data pointed to a continuation of weak credit dynamics in the region as a whole, and across the four major economies. However, there was an improvement in credit impulse metrics on an annual basis.

• Overall EZ bank lending growth to non-financial corporations (NFCs) and households was steady at 0.5% Y/Y. This represented a fall in NFC lending growth to 0.6% Y/Y (vs 0.7% prior) but a small pickup in household lending at 0.5% Y/Y (vs 0.3% prior). All figures are adjusted for sales and securitizations.
• At a country level, NFC lending growth failed to accelerate in any of the four major EZ economies.
• All countries saw a pickup in household lending growth, with Spanish annual lending growth exiting negatively territory for the first time since Jan 2023 (at 0.0% Y/Y vs -0.3% prior). 
• The 12m/12m credit impulse continued its improvement from late-2023 lows across countries, but remains negative in Germany and France.
•  When comparing the last 3-months to the same 3-months last year, the German credit impulse stands out as weak in 2024, providing some context to the lack of economic recovery seen over the past few months. See our latest German Macro Signal publication for more on that front.