ECB’s Press release

Friday, 27 May 2011 11:27

Monetary Developments in the Euro Area for April were released just minutes ago.  Year on year growth rate of M3 came out lower than expected at 2.0%, decreasing from 2.5% value expected and prior March results of 2.3%. 

Traders take an interest in these releases as it measures change in the total quantity of domestic currency in circulation and deposited in banks; and it's positively correlated with interest rates – early in the economic cycle an increasing supply of money leads to additional spending and investment, and later in the cycle expanding money supply leads to inflation. 

Furthermore news for the European Union annual Private Loans (the change in the total value of new loans issued to consumers and businesses in the private sector) also came out lower than expectations.  Year on year results were released at 2.6%, while it was forecasted at 2.7%.  Although lower than expected, the 2.6% results was a little higher than last year's 2.5%.

The Euro is positively trading higher against the U.S Dollar as it passed the 1.41 line, entering the 1.42 zone and currently trading at 1.4252.

EUR/GBP is currently trading at 0.8668