Lending growth ups chances of rate rise

ANOTHER month of very strong bank lending across the eurozone makes an ECB interest rate rise on June 8 a near certainty.

But the good news is that the recent instability of global equity markets makes it likely the increase will be 0.25% and not 0.5% as some economists had forewarned.

“But for this turbulence, the strength of these data and an uncomfortably high inflation of 2.4% suggest a 0.5% rate increase could have been the likely outcome,” said Austin Hughes, chief economist, IIB Bank.