Eurozone: the debt of non-financial institutions is growing. The sign is not good
According to ECB data, lending to households in the euro area recovered from Trading economics increased by 4.2 percent year-on-year in November 2021, with an acceleration from 4.1 percent the previous month and corresponding to the increase in August, which was the largest since November 2008. In addition, business credit increased by 2.9 percent. , compared to 2.5 percent in October. Private sector credit growth, including households and non-financial corporations, accelerated to 3.7 percent in November, up from 3.4 percent the previous month.
Eurozone lending has increased this year due to low interest rates, growing mortgage demand and short-term financing needs opposing supply bottlenecks. A not particularly positive sign for two reasons:
- the spike in loan growth for non-financial entities reached its peak just on the eve of the great financial crisis;
- given that there have been no particular increases in income in the euro area, there is a risk that the increase in prices will translate into a drop in disposable income at the first rate adjustment, thus cutting consumption and paving the way for an economic crisis .
Who made the most private non-financial debt? Not Italy …
But our neighbors do, France
There are 20 percentage points between the debts of Italian non-financial entities, including families and French ones. Even the Spaniards are not in good shape: if they are not 20 they are 18 percentage points …
Worse still are the Dutch, with non-financial private debt equal to the country's GDP …
The Dutch are among the countries that most want a restrictive maneuver from the ECB, yet they are among those who, privately, would pay the most for it. But clarity is not the predominant factor in the EU
Thanks to our Telegram channel you can stay updated on the publication of new articles of Economic Scenarios.
The Eurozone article : the debt of non-financial institutions is growing. The sign is not good comes from ScenariEconomici.it .
This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/eurozona-cresce-il-debito-delle-istituzioni-non-finanziarie-il-segno-non-e-buono/ on Wed, 29 Dec 2021 14:57:30 +0000.