Euro area M3 growth rises to 3.2 percent in March
The annual growth rate of the broad monetary aggregate M3 in the euro area increased to 3.2 percent in March 2026 from 3.0 percent in February. Meanwhile, narrower aggregate M1 growth decreased to 4.6 percent.
Broad money supply expands
The broad monetary aggregate M3 in the euro area saw its annual growth rate increase to 3.2 percent in March 2026, up from 3.0 percent in February.
This brought the three-month average growth rate up to March to 3.2 percent.
A closer look at the components reveals diverging trends.
The narrower aggregate M1, which includes currency in circulation and overnight deposits, experienced a decrease in its annual growth rate, falling to 4.6 percent in March from 4.8 percent in February.
This deceleration in M1, often seen as a proxy for transactional money, contrasts with the overall M3 expansion.
Furthermore, short-term deposits other than overnight deposits (M2-M1) also saw a decline, moving from a 0.2 percent growth rate in February to -0.1 percent in March.
Conversely, marketable instruments (M3-M2) showed a significant rebound, with their annual growth rate increasing sharply to 4.5 percent in March from -1.3 percent in February, indicating a notable shift in portfolio preferences within the monetary aggregates.
Loans to private sector accelerate
Regarding claims on euro area residents, the annual growth rate for total claims increased to 2.4 percent in March 2026 from 2.2 percent in the previous month.
This was primarily driven by an acceleration in claims on the private sector, which rose to 3.2 percent in March from 3.0 percent in February.
Claims on general government also saw an increase, reaching 0.4 percent in March from 0.1 percent in February.
Within the private sector, adjusted loans to households maintained a stable annual growth rate of 3.0 percent in March, consistent with the previous month.
Adjusted loans to non-financial corporations, however, showed an uptick, increasing to 3.2 percent in March from 3.0 percent in February.
This suggests a modest but sustained demand for credit from businesses, contributing to the overall expansion of claims on the private sector.
Shifting dynamics under the surface
The uptick in broad money supply is largely attributable to a surge in marketable instruments, while the more liquid M1 aggregate continues to decelerate.
This indicates a shift in portfolio allocation rather than a robust acceleration of transactional money.
For policymakers, this suggests underlying economic activity remains subdued, despite the headline M3 increase.