A jump in lending to home buyers helped drive up credit in the euro zone in May, European Central Bank data showed as it reported the strongest such rise in three years.
Lending to euro zone households and firms grew by 0.5% in May, the strongest signal yet that an ECB money-printing programme is starting to boost the economy, albeit only gradually.
The rise, although modest, is nonetheless an improvement over the previous years where credit had been shrinking.
It was driven in large part by a 1.4% jump in loans for house purchases across the euro zone although this picture typically varies dramatically between stronger economies such as Germany and weaker members.
The prospects for companies seeking credit looked different however. Lending to companies, the real engine of growth and employment in the economy, shrank by 0.3% in May, the latest in a series of monthly falls.
Sparse lending to companies has dogged the struggling euro zone economy although ECB President Mario Draghi believes that the bloc is turning the corner.
The latest result may strengthen his argument.
The M3 measure of money circulating throughout the 19 countries in the euro zone grew at the slower pace of 5% in May, the ECB said. This was lower than the 5.3% growth rate in April.
Analysts described the result as "marginally positive news" for the ECB, pointing to lacklustre lending to business.
ECB leaves emergency aid unchanged for Greek banks
The European Central Bank left its emergency lifeline for Greek banks unchanged today for a second day, as deposit withdrawals stabilised, a source familiar with the matter said.
Banking deposit withdrawals - which accelerated sharply last week - have "really calmed down" in recent days, the source added.
A separate banking source in Greece said the Bank of Greece had "got approval for the ELA it requested", but again omitted the word "increase" that had previously been used.
On Wednesday, the ECB had increased its Emergency Liquidity Assistance (ELA) fund for Greece's banks for the fifth time in an eight-day period.
Meanwhile, the Bank of Greece revealed data showing that the pace of bank deposit withdrawals fell in May from the previous month.
Withdrawals totalled €3.87 billion last month, compared with €4.67 billion in April, the cental bank said.
Recent Greek media reports suggested that up to €6 billion were withdrawn from the nation's banks last week.
