Overnight deposits remain the main factor in money supply growth
Overnight deposits, particularly those of non-financial corporations that secure their cash flow by making increasing use of bank credit, continue to grow atypically in April (+19.4%, after +15.7% in March and +11.1% in February). The slowdown in resident resources included in M2-M1 (up 4.3% after 5.2% in March and 3.8% in February) is attributable to the increase in growth in saving accounts (up 5.5% in April after 4.4% in March) compensated by the fall in time deposits (down 2.2% in April after 10.5% in March).
The sharp contraction in money market fund shares (-18.3% in April after -11.1% in March) and the deceleration in repurchase agreements and debt securities issued with a maturity of up to two years (+1.9% after +15.2% in March) explain why the M3-M2 aggregate decelerated and partly dampened the growth of the M1 aggregate.
After taking into account monetary assets and liabilities vis-à-vis other monetary union members, the growth rate of the French component of the M3 aggregate stabilizes at a high level (+ 10.1 % in March and April).
France : monetary resources of Monetary Financial Institutions
||Outstandings (in € Bn) (a)
||Annual growth rate (in %) (a)
|= Domestic resources included in M1
|Domestic resources included in M1, 3-month moving average
|Deposits with agreed maturity of up to 2 years
|+ Saving accounts
|= Domestic resources included in M2-M1
|Domestic resources included in M2-M1, 3-month moving average
|+ Repurchase agreements
|+ Debt securities issued with a maturity of up to 2 years
|= Domestic resources included in M3-M2
|Domestic resources included in M3-M2, 3-month moving average
|Sum of domestic resources included in M3
|Sum of domestic resources included in M3 , 3-month moving average
|+ Monetary external liabilities vis-à-vis other monetary union members
|- Monetary external assets vis-à-vis other monetary union members
|= French component of euro area monetary aggregate M3
|French component of euro area monetary aggregate M3, 3-month moving average
(a) Seasonally-adjusted data.
Source : Banque de France
Contributions to the growth of the French component of M3
(Annual growth rate in %)
The outstanding amount of monetary claims (excluding coins and banknotes) consists of claims with an initial maturity of up to and including 2 years that monetary counterparts (basically households, non-financial corporations, general government excluding central government, insurance corporations, non-money market funds, investment funds and financial vehicle corporations) hold against monetary financial institutions (deposit-taking institutions, sociétés de financement under French law, Caisse des dépôts et consignations, MMF and the central bank).
Saving accounts include regulated saving accounts, i.e. livrets A, livrets de développement durable, comptes d'épargne logement, livrets d'épargne populaire, and non-regulated saving accounts, i.e. livrets jeunes and livrets ordinaires. One part of the amounts held on regulated saving accounts is transferred by deposit-taking institutions to a fund managed by the Caisse des dépôts et consignations; the other part remains in banks' balance sheets. Debt securities with maturity of up to 2 years mainly include certificates of deposit (short term paper) issued by French deposit-taking institutions and subscribed by neither MMF nor deposit-taking institutions counterparts.
Annual growth rates are adjusted for reclassifications and revaluations but not for foreign exchange rate effects.
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Published on Friday, May 29, 2020