About a year ago, the European Central Bank singled out a recovery in bank loans to private businesses as crucial to a lasting economic recovery – and even more crucially for the ECB, a rise in inflation which it targets at 2 percent.
from Rahul Karunakar:
Almost a year after the European Central Bank announced new cash loans tied to actual lending to small and medium enterprises, data on Friday is expected to show euro zone private loans are picking up pace.
The Greek government states that a cash-for-reforms deal with the EU and IMF can be finalized in the next 10 days but the other side is much less optimistic and there was no sign of a breakthrough at the EU summit in Riga which Prime Minister Alexis Tsipras had been pinning some hope on.
Euro zone inflation rose to zero in April from -0.1 percent and in Britain it fell to -0.1 percent from zero, the first negative reading since the 1960s.
An interesting weekend intervention by ECB policymaker Yves Mersch who said there was no question of winding up QE early and that inflation, still skulking around zero, would stay there until autumn then rise sharply late in the year towards 1.5 percent.