Broad money expanded a solid 0.7 percent on the month in March, its strongest performance since January 2023. Following an upwardly revised 0.6 percent gain in February, the latest increase lifted annual growth from minus 1.0 percent to 0.5 percent, its first positive print since last April. Annualised growth over the last three months now stands at 5.1 percent. There was also bullish news on M4 lending which fully unwound February's 0.9 percent decline.

Excluding intermediate other financial institutions, M4 rose 0.4 percent versus February and was up 0.3 percent on the year, a 9-month high. Similarly-adjusted lending increased a monthly 0.5 percent and was 0.9 percent firmer versus March 2023.

Elsewhere the financial data were more mixed. In the housing market, mortgage approvals climbed from an upwardly revised 60,497 to 61,325, their sixth straight gain and their highest level since September 2022. However, mortgage lending was only £0.26 billion, down from £1.65 billion, That said, overall consumer credit rose £1.577 billion, up from £1.429 billion.

In sum, today's data would appear consistent with a gradual recovery in economic activity. The housing market in particular looks to be enjoying quite solid growth although recent hikes in mortgage rates could be act as a brake over coming months.

M4 is the Bank of England's main broad measure of money supply. There is no target for M4 and in practice the central bank tends to follow an adjusted measure that excludes intermediate other financial corporations in order to get a handle on current underlying trends. The M4 private sector lending counterpart is the most closely watched aspect of the report.

M4 is similar to the M3 measure used in some other countries. M4 includes everything in M2 (also called the retail component of M4) plus other deposits with an original maturity of up to five years; other claims on financial institutions such as repos and bank acceptances; debt instruments issued by financial institutions including commercial paper and bonds with a maturity of up to five years. Understanding the role of money in the economy has always been an important issue for policymakers. And the pickup in broad money growth and decline in credit spreads over the past three years together with more recent financial market turbulence has made it a particularly pertinent issue. Monetary data can potentially provide important corroborative or incremental information about the outlook for inflation. Quantitative easing is essentially a policy aimed at boosting money supply.