Mortgage Lending Increases in Eurozone
Eurozone mortgage borrowing grew last month at the fastest pace in 2 years. Lending for house purchases rose at an annual rate of 3.4 per cent in June. This is the fastest rate since September 2008 according to the data supplied by European Central Bank.
The increase points to a revival in consumer confidence and an increase in the willingness of banks to loan to the private sector thus fueling economic recovery. The data also helps bring light to the past forecasts of economists who had expressed fears about the Eurozone’s banking system’s stability. The areas showing an increase in lending for house purchases were France, Italy, and Spain. Julian Callow, European economist at Barclays Capital, said the housing lending was due to the economic crisis measures taken by ECB. "The action of the ECB is really helping to keep down mortgage rates. It ought to be followed by an improvement in corporate lending activity."