Euro zone bank lending to firms remained steady last month, while a key EU economic sentiment indicator saw a slight increase in November. This data suggests that the currency bloc is maintaining steady growth, albeit at a moderate pace. The European Commission’s Economic Sentiment indicator rose marginally to 97.0 in November from 96.8 the previous month, reflecting varying performances across key sectors.
Despite the slight overall improvement, industrial confidence declined after a brief rise, and consumer confidence remained stable. Construction saw a significant boost, and the services indicator also experienced a notable increase, contributing to the slightly positive overall index. The euro zone economy has shown unexpected resilience to trade shocks and broader uncertainty this year, but the growth is modest, which lags behind global peers.
Credit growth to businesses remained unchanged at 2.9% in October compared to the previous month. Conversely, loan growth to households accelerated to a two-and-a-half-year high of 2.8%, up from 2.6%. While domestic consumption remains steady, exports have struggled as industry loses competitiveness, China increases its presence in key markets, and U.S. tariffs continue to impact the region.
The M3 measure of money circulating within the euro zone, an indicator of future economic activity, remained stable at 2.8%. This figure aligns with expectations from a Reuters poll of analysts, further suggesting consistent, yet unspectacular, economic performance for the euro zone.
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