In April 2025, the average three-month annual growth rate of broad money supply (M3) rose to 3.83 percent, up from 3.7 percent in March, driven largely by a sharp rise in M1 (currency and overnight deposits), which surged to 4.7 percent. This increase indicates heightened liquidity and possibly a shift toward more liquid assets, as M2-M1 (short-term time deposits) and M3-M2 (marketable instruments) declined.

Credit activity also gained pace. Adjusted loans to households rose from 1.7 percent to 1.9 percent, suggesting recovering consumer confidence or borrowing capacity. Loans to non-financial corporations increased to 2.6 percent, reflecting modest business financing growth. Despite this, household deposit growth eased slightly to 3.4 percent, while corporate deposits rose to 2.6 percent, indicating cautious optimism among firms.

Notably, investment funds (excluding money market funds) placed deposits at an accelerating pace, with growth reaching 21.2 percent a substantial jump from 16.1 percent in March. As a result, the latest update indicates a cautiously expanding monetary environment, with increased liquidity and lending supporting a steady economic recovery in the euro area. The latest update brings the Euro Area RPI to 14 and the RPI-P to 16, meaning economic activities are currently ahead of the bloc's expectations.

Money supply growth expected at 3.7 percent in April, same as in March.

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.