The broad monetary aggregate, M3, grew at an annual rate of 3.8 percent, up from 3.4 percent in October, reflecting increased liquidity in the economy. This was complemented by a notable recovery in the narrower M1 aggregate, which climbed to 1.5 percent from 0.2 percent, indicating strengthened consumer and business confidence in holding readily accessible funds. On average, M3 grew 3.5 percent between September and November in line with the consensus.

Adjusted loans to households also showed a marginal uptick, with growth improving to 0.9 percent from 0.8 percent in October. This suggests a cautious but steady demand for consumer credit and mortgages, potentially driven by stabilising economic conditions. However, loans to non-financial corporations exhibited a contrary trend, with growth slowing to 1.0 percent from 1.2 percent, signalling subdued business borrowing.

The latest data point to a delicate balance in monetary dynamics: while household borrowing and liquidity are improving, the deceleration in corporate lending highlights lingering pressures on the business landscape, taking the RPI to 3 and the RPI-P to 4. This means that economic activities, in general, are in line with the market consensus of the UK economy.

Forecasters look for a slight acceleration in money growth to 3.5 percent from 3.2 percent in the previous month.

M3 is the European Central Bank's (ECB) preferred broad measure of money supply. Since January 1999, the ECB has tended to focus on the 3-month moving average of the annual growth rate to judge underlying M3 trends although the significance of its 4.5 percent reference rate has been downgraded with time. The private sector lending counterpart is usually seen as the most important element of the M3 report.

While other central banks have virtually ignored money supply data, the European Central Bank has not. Thanks to the influence of the Bundesbank in organizing the ECB, M3 money supply was established as one of the 'two pillars' of monetary policy used by the ECB, the other being the harmonized index of consumer prices (HICP). While the target for HICP is two percent, the seemingly largely ignored reference target for M3 growth is 4.5 percent as measured by a three month moving average which is compared with the same three months a year earlier.

M3 measures overall money supply. It consists of M1 which is currency in circulation plus overnight deposits and M2 which include deposits with an agreed maturity up to two years plus deposits redeemable at up to three months' notice. Not all M3 measures are alike. For example, ECB M3 is approximately equivalent to the Federal Reserve's M2 measure. Because an increase in M3 leads to price inflation, this figure can also be indicative of the likelihood of future interest rate hikes.