Euro zone money supply figures released this morning have reinforced expectations that the European Central Bank will continue to raise interest rates in the coming months.
Growth in the money supply, as measured by the M3 indicator, picked up again in May to an annual rate of 10.7%, up from 10.4%% in April. The figures came from the ECB.
M3 covers cash, overnight deposits, other short-term deposits, repurchase agreements, shares and units in money market funds and debt securities with a maturity of up to two years.
It is the ECB's preferred indicator of medium-term inflationary trends in the euro zone economy.
Because the monthly figures are volatile, the ECB also calculates a three-month moving average for M3 growth, which also accelerated to 10.7% in the period from March to May from 10.4% in the period from February to April.
