BCE Bulletin mensuel Juillet 2010

	BCE Bulletin mensuel Juillet 2010	Téléchargement
	Publié par : Economist

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M O N T H LY B U L L E T I N
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BULLETIN 0312010
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MONTHL
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EAN CENTRAL BANK
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EUR
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M O N T H LY B U L L E T I N
J U LY 2 010
In 2010 all ECB
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© European Central Bank, 2010
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This Bulletin was produced under the
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is permitted provided that the source is
acknowledged.
The cut-off date for the statistics included
in this issue was 7 July 2010.
ISSN 1561-0136 (print)
ISSN 1725-2822 (online)

CONTENTS
EDITORIAL 5
ECONOMIC AND MONETARY
DEVELOPMENTS
The external environment of the euro area
9
Monetary and ﬁ nancial developments
1 4
Prices and costs
2 8
Output, demand and the labour market
3 5
Exchange rate and balance of payments
developments
4 6
Boxes:
1 New statistical series of hours worked,
productivity and labour costs for the
euro area
3 2
2 Household consumption of durable
goods during the latest recession
3 6
3 A comparison of employment
developments in the euro area
and the United States
4 0
4 China’s reform of the renminbi
exchange rate regime
4 8
ARTICLES
Labour market adjustments
to the recession in the euro area
5 3
The effectiveness of euro area ﬁ scal policies 6 7
The impact of the ﬁ nancial crisis on the
central and eastern European countries
8 5
EURO AREA STATISTICS
S1
ANNEXES
Chronology of monetary policy
measures of the Eurosystem
I
Documents published by the European
Central Bank since 2009
V
Glossary
X I I I
ECB
Monthly Bulletin
July 2010
3

ABBREVIATIONS
COUNTRIES
LU
Luxembourg
BE
Belgium
HU
Hungary
BG
Bulgaria
MT
Malta
CZ Czech
Republic
NL Netherlands
DK
Denmark
AT
Austria
DE
Germany
PL
Poland
EE Estonia
PT Portugal
IE
Ireland
RO
Romania
GR
Greece
SI
Slovenia
ES
Spain
SK
Slovakia
FR
France
FI
Finland
IT
Italy
SE
Sweden
CY
Cyprus
UK
United Kingdom
LV
Latvia
JP
Japan
LT
Lithuania
US
United States
OTHERS
BIS
Bank for International Settlements
b.o.p.
balance of payments
BPM5
IMF Balance of Payments Manual (5th edition)
CD
certiﬁ cate of deposit
c.i.f.
cost, insurance and freight at the importer’s border
CPI
Consumer Price Index
ECB
European Central Bank
EER
effective exchange rate
EMI
European Monetary Institute
EMU
Economic and Monetary Union
ESA 95
European System of Accounts 1995
ESCB
European System of Central Banks
EU
European Union
EUR
euro
f.o.b.
free on board at the exporter’s border
GDP
gross domestic product
HICP
Harmonised Index of Consumer Prices
HWWI
Hamburg Institute of International Economics
ILO
International Labour Organization
IMF
International Monetary Fund
MFI
monetary ﬁ nancial institution
NACE
statistical classiﬁ cation of economic activities in the European Union
NCB
national central bank
OECD
Organisation for Economic Co-operation and Development
PPI
Producer Price Index
SITC Rev. 4
Standard International Trade Classiﬁ cation (revision 4)
ULCM
unit labour costs in manufacturing
ULCT
unit labour costs in the total economy
In accordance with EU practice, the EU countries are listed in this Bulletin using the
alphabetical order of the country names in the national languages.
ECB
4
Monthly Bulletin
July 2010

EDITORIAL
Based on its regular economic and monetary Turning to the economic analysis, after a period
analyses, the Governing Council decided at of sharp decline, euro area economic activity
its meeting on 8 July 2010 to leave the key has been expanding since mid-2009. Euro
ECB interest rates unchanged. The current area real GDP increased, on a quarterly basis,
rates remain appropriate. Taking into account by 0.2% in the ﬁ rst quarter of 2010, according to
all the new information which has become Eurostat’s second estimate. The latest economic
available since its meeting on 10 June 2010, data and survey-based indicators suggest that a
the Governing Council continues to expect strengthening in economic activity took place
price developments to remain moderate over during the spring. The Governing Council
the policy-relevant medium-term horizon, expects real GDP to grow at a moderate and still
beneﬁ ting from low domestic price pressures. uneven pace over time and across economies
The latest information has also conﬁ rmed and sectors of the euro area. The ongoing
that the economic recovery in the euro area recovery at the global level and its impact on the
continued in the ﬁ rst half of 2010. Looking demand for euro area exports, together with the
ahead, the Governing Council expects the accommodative monetary policy stance and the
euro area economy to grow at a moderate and measures adopted to restore the functioning of
still uneven pace, in an environment of high the ﬁ nancial system, should provide support to
uncertainty. The monetary analysis conﬁ rms the euro area economy. However, the recovery
that inﬂ ationary pressures over the medium term
in activity is expected to be dampened by the
remain contained, as suggested by weak money process of balance sheet adjustment in various
and credit growth. Overall, the Governing sectors and labour market prospects.
Council expects price stability to be maintained
over the medium term, thereby supporting the According to the Governing Council’s
purchasing power of euro area households. assessment, the risks to the economic outlook
Inﬂ ation expectations remain ﬁ rmly anchored are broadly balanced, in an environment of high
in line with the aim of keeping inﬂ ation rates uncertainty. On the upside, the global economy
below, but close to, 2% over the medium term. and foreign trade may recover more strongly
The ﬁ rm anchoring of inﬂ ation expectations than projected, thereby further supporting
remains of the essence.
euro area exports. On the downside, concerns
remain relating to renewed tensions in ﬁ nancial
Monetary policy will do all that is needed to markets, with possible further adverse effects on
maintain price stability in the euro area over ﬁ nancing conditions and conﬁ dence. In addition,
the medium term. This is the necessary and a stronger or more protracted than previously
central contribution that monetary policy expected negative feedback loop between the
makes to fostering sustainable economic real economy and the ﬁ nancial sector, renewed
growth, job creation and ﬁ nancial stability. increases in oil and other commodity prices, and
All the non-standard measures taken during protectionist pressures, as well as the possibility
the period of acute ﬁ nancial market tensions, of a disorderly correction of global imbalances,
referred to as “enhanced credit support” and may weigh on the downside.
the Securities Markets Programme, are fully
consistent with the Governing Council’s With regard to price developments, euro area
mandate and, by construction, temporary in annual HICP inﬂ
ation was 1.4% in June,
nature. The Governing Council remains ﬁ rmly according to Eurostat’s ﬂ ash estimate, after
committed to price stability over the medium 1.6% in May. In the next few months, annual
to longer term. The monetary policy stance and HICP inﬂ ation rates are expected to display
the overall provision of liquidity will be adjusted some further volatility, with a tendency towards
as appropriate. Accordingly, the Governing somewhat higher rates later in the year. Looking
Council will continue to monitor all developments
ahead, in 2011 inﬂ ation rates should overall
over the period ahead very closely.
remain moderate, beneﬁ ting from low domestic
ECB
Monthly Bulletin
July 2010
5

price pressures. Inﬂ ation expectations over the growth in loans to households and negative
medium to longer term continue to be ﬁ rmly growth in loans to non-ﬁ nancial corporations.
anchored in line with the Governing Council’s While the monthly ﬂ ow in bank loans to
aim of keeping inﬂ ation rates below, but close non-ﬁ nancial corporations was positive in May,
to, 2% over the medium term.
in the light of the volatility observed in recent
months it is too early to judge whether this
Risks to the outlook for price developments are signals a turning-point. A lagged response
broadly balanced. Upside risks over the medium of loans to non-ﬁ
nancial corporations to
term relate, in particular, to the evolution of developments in economic activity is a normal
commodity prices. Furthermore, increases in feature of the business cycle.
indirect taxation and administered prices may
be greater than currently expected, owing to The data up to May conﬁ rm that the size of
the need for ﬁ scal consolidation in the coming banks’ overall balance sheets has increased
years. At the same time, risks to domestic price since the turn of the year. The challenge remains
and cost developments are contained. Overall, for banks to expand the availability of credit
the Governing Council will monitor closely the to the non-ﬁ nancial sector when demand picks
future evolution of all available price indicators.
up. Where necessary, to address this challenge,
banks should retain earnings, turn to the market
Turning to the monetary analysis, the annual to strengthen further their capital bases or take
growth rate of M3 was unchanged at -0.2% in full advantage of government support measures
May 2010. The annual growth rate of loans to for recapitalisation. In this respect, the Governing
the private sector increased slightly further Council welcomes the decision announced
but, at 0.2%, remained weak. Together, these by the European Council to publish, with the
data continue to support the assessment that consent of the banks involved, the individual
the underlying pace of monetary expansion is results of the stress test exercise for banks in the
moderate and that inﬂ ationary pressures over European Union carried out by the Committee
the medium term are contained. Shorter-term
of European Banking Supervisors (CEBS) in
developments in M3 and some of its components
cooperation with the ECB. Appropriate action
and counterparts have remained volatile and, will have to be taken where needed. Sound
given the continued tensions in some ﬁ nancial balance sheets, effective risk management and
market segments, this volatility may well transparent, robust business models are key to
persist.
strengthening banks’ resilience to shocks and
to ensuring adequate access to ﬁ nance, thereby
The previously strong impact of the interest rate laying the foundations for sustainable growth,
constellation on monetary dynamics appears to job creation and ﬁ nancial stability.
be gradually waning. This implies that actual
M3 growth is less affected than before by the To sum up, the current key ECB interest rates
downward impact of the steep yield curve and the remain appropriate. Taking into account all the
associated allocation of funds into longer-term
new information which has become available
deposits and securities outside M3. Moreover, since its meeting on 10 June 2010, the Governing
the impact that the narrow spreads between the Council continues to expect price developments
interest rates paid on different M3 instruments to remain moderate over the policy-relevant
have on shifts within M3 towards M1 should medium-term horizon, beneﬁ ting from low
be diminishing. However, at 10.3%, annual M1 domestic price pressures. The latest information
growth is still very strong.
has also conﬁ rmed that the economic recovery
in the euro area continued in the ﬁ rst half of
The still weak annual growth rate of bank 2010. Looking ahead, the Governing Council
loans to the private sector continues to conceal expects the euro area economy to grow
countervailing developments, with positive at a moderate and still uneven pace, in an
ECB
6
Monthly Bulletin
July 2010

E D I T O R I A L
environment of high uncertainty. A cross-check Regarding the proposals submitted by the
of the outcome of the economic analysis with Governing Council to the Task Force on
that of the monetary analysis conﬁ rms that Economic Governance established by the
inﬂ ationary pressures over the medium term European Council under the chairmanship
remain contained, as suggested by weak money of President Van Rompuy, in the view of the
and credit growth. Overall, the Governing Governing Council a quantum leap in terms of
Council expects price stability to be maintained progress towards strengthening the institutional
over the medium term, thereby supporting the foundations of EMU is needed. It is essential
purchasing power of euro area households. that governance and enforcement structures
Inﬂ ation expectations remain ﬁ rmly anchored in the economic policy framework of the euro
in line with the aim of keeping inﬂ ation rates area be strengthened. Reinforcing surveillance
below, but close to, 2% over the medium term. of national budgetary policies and ensuring
The ﬁ rm anchoring of inﬂ ation expectations rigorous compliance with the ﬁ scal rules will
remains of the essence.
be key. Furthermore, it is extremely important
that close oversight of relative competitiveness
As regards ﬁ scal policies, the focus clearly developments be implemented and that a
needs to be on ensuring the sustainability of surveillance mechanism be established to
public ﬁ nances. In the current environment, address imbalances in the euro area countries.
all euro area countries must, as a minimum, At the same time, it is important to establish
comply with their ﬁ scal consolidation plans an appropriate euro area crisis management
as foreseen under the respective excessive framework that minimises moral hazard.
deﬁ
cit procedures. More ambitious targets,
as already adopted by a number of countries, This issue of the Monthly Bulletin contains
may become necessary where current plans fall three articles. The ﬁ rst article examines euro
short of meeting the main objective of halting area labour market adjustments in the context
and reversing the increase in the government of the recent recession. The second article
debt ratio. Moreover, all countries must specify assesses the effectiveness of euro area ﬁ scal
credible adjustment measures that are sufﬁ cient policies. The third article discusses the impact
to attain their budgetary targets for 2010, of the ﬁ nancial crisis on economic activity in
2011 and beyond, and must live up to their the central and eastern European countries.
commitment to take additional measures, where
needed, over the coming years.
For the proper functioning of the euro area,
and to strengthen the prospects for higher
sustainable growth, the pursuit of far-reaching
structural reforms is essential. This will also
support the process of ﬁ scal consolidation.
Major reforms are particularly needed in those
countries that have experienced competitiveness
losses in the past or that are suffering from high
ﬁ scal and external deﬁ cits. Measures should
ensure a wage bargaining process that allows
wages to adjust ﬂ exibly to the unemployment
situation and losses in competitiveness.
Reforms to strengthen productivity growth
would further support the adjustment process of
these economies.
ECB
Monthly Bulletin
July 2010
7

E C O N O M I C
A N D M O N E T A R Y
D E V E L O P M E N T S
E C O N O M I C A N D M O N E T A R Y
The external
D E V E L O P M E N T S
environment
of the euro area
1 THE EXTERNAL ENVIRONMENT
OF THE EURO AREA
The global economy is recovering at a steady pace. However, the strength of the upturn is rather
uneven across countries. While most emerging economies have recorded vigorous economic
growth, the momentum in most advanced economies has remained more subdued. These uneven
growth patterns have also been reﬂ ected in divergent inﬂ ationary pressures across regions,
although global price pressures have continued to be rather muted overall. Inﬂ ation rates have
risen to higher levels in fast-growing emerging economies, but have remained subdued in major
advanced economies. Risks to the global economic outlook are seen to be broadly balanced.
1.1 DEVELOPMENTS IN THE WORLD ECONOMY
Chart 1 Global PMI output
The global economy is recovering at a steady
pace, supported by the ongoing policy stimuli
(diffusion index; seasonally adjusted; monthly data)
and the favourable inventory cycle. However,
PMI output: overall
PMI output: manufacturing
the strength of the upturn is rather uneven across
PMI output: services
countries. While most emerging economies
65
65
have recorded vigorous economic growth, 60
60
the momentum in most advanced economies has
remained more subdued.
55
55
50
50
Short-term indicators suggest that the pace of the
45
45
economic expansion, while remaining robust,
40
40
has been moderating in both the manufacturing
and the services sectors (see Chart 1). The overall
35
35
global PMI output eased to 55.4 in June from
30
30
57.0 in the previous month. This ﬁ gure is still
25
25
well above the series average and consistent
1999
2001
2003
2005
2007
2009
with strong global growth. Business activity
Source: Markit.
continues to be supported by a further solid,
albeit moderating, expansion in incoming new
orders, both domestically and from abroad. This
Chart 2 International price developments
also bodes well for euro area foreign demand.
(monthly data; annual percentage changes)
Global price pressures have remained
OECD consumer prices (all items)
rather muted overall, but the uneven growth
OECD consumer prices (all items excluding food
patterns have also been reﬂ ected in divergent
and energy)
inﬂ
ationary pressures across countries and
6
6
regions. In major advanced economies, 5
5
CPI inﬂ ation has remained subdued, while
4
4
inﬂ ation rates have risen to higher levels in
fast-growing emerging economies. Overall,
3
3
in the OECD area, headline consumer prices
2
2
rose by 2.0% in the year to May, compared
with 2.1% in April (see Chart 2). The decline
1
1
in headline inﬂ ation was mainly driven by a
0
0
slowdown in annual energy price inﬂ ation in
May compared with April. Annual consumer
-1
-1
1999
2001
2003
2005
2007
2009
price inﬂ ation excluding food and energy was
1.3% in May, unchanged from the previous
Source: OECD.
ECB
Monthly Bulletin
July 2010
9

month. Global PMI input prices signal that cost
Chart 3 Main developments in major
inﬂ ation slowed in most manufacturing sectors
industrialised economies
covered by this survey.
euro area
United States
UNITED STATES
Japan
United Kingdom
In the United States, real GDP growth lost some
Output growth 1)
momentum in the ﬁ rst quarter of 2010, after
(quarter-on-quarter percentage changes; quarterly data)
having rebounded strongly in the last quarter
3
3
of 2009. According to the third estimate by
2
2
the Bureau of Economic Analysis, real GDP
increased by 2.7% in annualised terms in the
1
1
ﬁ rst quarter of 2010, following a 5.6% increase
0
0
in the last quarter of 2009. Private inventories
-1
-1
accounted for more than half of the overall
-2
-2
increase in GDP in the ﬁ rst quarter of 2010. GDP
growth also partly reﬂ ected resilient consumer
-3
-3
spending, which rose at an annualised rate of
-4
-4
3.0%. Business spending continued to recover,
-5
-5
led by another marked rise in investment in
1999
2001
2003
2005
2007
2009
equipment and software. On the other hand,
Inflation rates 2)
growth was dampened by a large decline in state
(consumer prices; annual percentage changes; monthly data)
and local government spending and a negative
6
6
contribution from trade, as the increase in
5
5
imports outpaced that in exports.
4
4
As regards price developments, annual CPI
3
3
inﬂ ation was 2.0% in May compared with
2
2
2.2% in April. A slowdown in annual energy
1
1
price inﬂ ation in May accounted for the fall in
0
0
headline CPI. Excluding food and energy, annual
-1
-1
inﬂ ation remained at 0.9% in May, the lowest
-2
-2
rate since 1966, reﬂ ecting lower inﬂ ationary
pressures amid substantial economic slack.
-3
-3
1999
2001
2003
2005
2007
2009
Sources: National data, BIS, Eurostat and ECB calculations.
On 23 June 2010 the US Federal Open Market
1) Eurostat data are used for the euro area and the United
Kingdom; national data are used for the United States and Japan.
Committee (FOMC) decided to maintain its
GDP ﬁ gures have been seasonally adjusted.
target range for the federal funds rate at 0% to
2) HICP for the euro area and the United Kingdom; CPI for the
United States and Japan.
0.25%. The FOMC continues to hold the view
that economic conditions, including low rates
of resource utilisation, subdued inﬂ ationary trends and stable inﬂ ation expectations, are likely to
warrant exceptionally low levels of the federal funds rate for an extended period.
JAPAN
In Japan, economic activity has shown further signs of recovery, while deﬂ ation is moderating.
According to the second preliminary estimate by Japan’s Cabinet Ofﬁ ce, real GDP increased in the
ﬁ rst quarter of 2010 by 1.2% on a quarterly basis. The June Tankan survey revealed that, while ﬁ rms’
assessment of current business conditions has improved, their outlook remains cautious.
ECB
10 Monthly Bulletin
July 2010

E C O N O M I C
A N D M O N E T A R Y
D E V E L O P M E N T S
The external
environment
of the euro area
Consumer prices continued to decline, albeit to a lesser extent, owing to the signiﬁ cant slack in the
economy. Annual CPI inﬂ ation was -0.9% in May compared with a rate of -1.2% in April. At the
same time, CPI inﬂ ation excluding food and energy was -1.6% year on year in May, unchanged
from April.
At its meeting on 15 June 2010, the Bank of Japan decided to leave its target for the uncollateralised
overnight call rate unchanged at 0.1%.
UNITED KINGDOM
In the United Kingdom, recent indicators continue to suggest ongoing recovery. Quarter-on-quarter
real GDP growth was revised up to 0.3% (from 0.2%) in the ﬁ rst quarter of 2010 (see Chart 3).
Output growth was mainly driven by a positive contribution from inventories, while household
expenditure was unchanged and net trade continued to weigh negatively. House prices have
continued their upward trend, at least in year-on-year terms. The Halifax house price index was
5.3% higher in May 2010 compared with one year ago. Looking forward, activity is expected to
continue its gradual recovery, supported by lagged effects of the depreciation of the pound sterling,
monetary stimuli, and improvements in overall global conditions. However, the economic outlook
continues to be dampened by the need for substantial ﬁ scal tightening, further adjustment in banking
sector balance sheets, and rising private sector savings against the background of high levels of
indebtedness and increased uncertainty.
Annual CPI inﬂ ation, after being on an upward trend in recent months, decreased to 3.4% in May
from 3.7% in April. The restoration of the VAT rate in January 2010, annual increases in energy
prices and the lagged effect of the pound’s depreciation have continued to exert upward pressure
on annual inﬂ ation. On 10 June the Bank of England’s Monetary Policy Committee voted to
maintain the ofﬁ cial Bank Rate paid on commercial bank reserves at 0.5%. The Committee also
voted to maintain the stock of asset purchases ﬁ nanced by the issuance of central bank reserves at
GBP 200 billion.
OTHER EUROPEAN COUNTRIES
In most other non-euro area EU countries, real GDP growth has returned to positive territory and
capacity utilisation rates have increased in manufacturing. This gradual recovery mainly reﬂ ects
the continued improvement in external demand and the gradual pick-up in consumer conﬁ dence.
Overall, short-term activity indicators suggest continuing recovery.
In Sweden, real GDP increased by 1.4% quarter on quarter in the ﬁ rst quarter of 2010, following
growth of 0.4% in the fourth quarter of 2009. In Denmark, output increased by 0.6% in the ﬁ rst
quarter of 2010, up from 0.1% in the fourth quarter of 2009. Short-term indicators clearly point to
continuing recovery in Sweden and Denmark, although business investment remains weak in both
countries. In May 2010 annual HICP inﬂ ation moderated to 1.9% in both countries.
Among the largest central and eastern European EU countries, only Romania registered negative real
GDP growth in the ﬁ rst quarter of 2010, at -0.3% in quarter-on-quarter terms. Meanwhile, growth
reached 0.9% in Hungary and 0.5% in the Czech Republic and Poland. Overall, with the exception
of Romania, recent conﬁ dence indicators as well as industrial production and trade ﬁ gures point to
an improvement in activity. At the same time, a number of factors – including rising unemployment
and weak credit conditions (particularly in Hungary and Romania) – point to continued weakness
ECB
Monthly Bulletin
July 2010
11

in domestic demand. In May 2010 annual HICP inﬂ ation stood at 1.0% in the Czech Republic and
2.3% in Poland. In Hungary and Romania, annual HICP inﬂ ation remained elevated at 4.9% and
4.4% respectively.
EMERGING ASIA
Output growth remained robust in emerging Asia during the second quarter of 2010, as conﬁ rmed
by the latest monthly indicators. In particular, the region has experienced a strong rebound in export
growth thus far this year, in sharp contrast to one year ago. Average year-on-year monthly growth
rates for the exports of major economies in the region ranged between 25% and 50% in the ﬁ rst
ﬁ ve months of 2010. At the same time, inﬂ ationary pressures are on the rise and CPI inﬂ ation was
somewhat higher in May compared with previous months in most countries in the region.
Although high frequency indicators point to a slight deceleration, China’s economic growth
remained robust in the second quarter of 2010. Private domestic demand – both investment and
consumption – has become increasingly self-sustained, thus allowing for a gradual withdrawal of
public stimuli. External demand has recovered markedly, with real exports growing at 45% in May
compared with a year earlier. Inﬂ ationary pressures continued to increase in May mainly on account
of rising food and raw material prices, and annual CPI and PPI inﬂ ation reached 3.1% and 7.1%
respectively. The administrative measures taken at the end of April to curb speculative demand in
the housing market have started to produce some results, although it is too early for an assessment
of the impact on property prices and residential investment.
LATIN AMERICA
In Latin America, economic activity strengthened further in the ﬁ rst quarter. In Brazil, in the ﬁ rst
quarter of 2010 real GDP grew by 8.9% on an annual basis, following an increase of 4.4% in
the fourth quarter of 2009. In May annual inﬂ ation stood at 5.2%, unchanged from the previous
month. On 10 June the Banco Central do Brasil
raised its key interest rate by 75 basis points,
to 10.25%. In Argentina, in the ﬁ rst quarter
Chart 4 Main developments in commodity
prices
of 2010 real GDP expanded by 6.3% on an
annual basis. Consumer price inﬂ ation increased
further in May, to 10.7%. In Mexico, industrial
Brent crude oil (USD/barrel; left-hand scale)
non-energy commodities (USD; index: 2000 = 100;
production grew by 6.1% in April, while annual
right-hand scale)
inﬂ ation stood at 3.9% in May, 0.4 percentage
150
300
point lower than in the previous month.
140
285
130
270
120
255
1.2 COMMODITY MARKETS
110
240
100
225
Following a decrease in May, oil prices
90
210
increased during most of June before declining
80
195
again in early July, amid considerable volatility.
Brent crude oil prices stood at USD 72.3 per
70
180
barrel on 7 July, which is 7.6% lower than
60
165
at the beginning of the year (see Chart 4).
50
150
Looking ahead, market participants are expecting
40
135
slightly higher oil prices in the medium term,
30
120
2008
2009
2010
with futures contracts for December 2012
Sources: Bloomberg and HWWI.
trading at around USD 82.4 per barrel.
ECB
12 Monthly Bulletin
July 2010

E C O N O M I C
A N D M O N E T A R Y
D E V E L O P M E N T S
The external
environment
of the euro area
The International Energy Agency (IEA) has revised its oil demand projections upwards on the back
of stronger than expected demand in OECD economies, particularly in the United States, while oil
demand in non-OECD countries continues to be robust. Oil supply, however, remains ample and
is partially dampening the demand-side pressures. Overall, the IEA expects oil production in 2010
to be higher owing to stronger than expected non-OPEC production. Over the medium term,
oil supply is forecast to remain high owing to increased OPEC production capacity following new
investment.
The prices of non-energy commodities were slightly higher in June. Food prices increased on the
back of rising wheat prices, whereas metal prices continued to decline, largely owing to decreasing
prices of copper and nickel. In aggregate terms, the price index for non-energy commodities
(denominated in US dollars) was about 11.7% higher in early July compared with the beginning of
the year.
1.3 OUTLOOK FOR THE EXTERNAL ENVIRONMENT
According to survey and leading indicators, some moderation in the growth momentum might be
expected later this year as the impact of temporary factors such as the favourable inventory cycle
and the policy stimulus fades. Leading indicators suggest that the peak in the recent recovery may
have passed, pointing to a slowdown in economic expansion in advanced and emerging economies
approximately one to two quarters ahead. The composite leading indicators for the OECD countries
point to a slowing pace of expansion in April, with a lower pace of growth for the ninth consecutive
month (see Chart 5). Tentative signs of a
potential peak have also appeared in major
Chart 5 OECD composite leading indicators
non-OECD countries such as Brazil and China.
Conﬁ dence indicators for major economies also
give somewhat mixed signals overall, suggesting
(monthly data; amplitude-adjusted)
a rather solid current economic situation, but
OECD
with more subdued expectations regarding the
emerging markets
near future.
106
106
104
104
In an environment of high uncertainty, the risks
to global activity remain broadly balanced.
102
102
On the upside, trade may recover more strongly
100
100
than projected. On the downside, concerns
remain relating to renewed tensions in ﬁ nancial
98
98
markets, with possible further adverse effects on
96
96
ﬁ nancing conditions and conﬁ dence. In addition,
a stronger or more protracted than previously
94
94
expected negative feedback loop between the
92
92
real economy and the ﬁ nancial sector, renewed
increases in oil and other commodity prices, and
90
90
1999 2001 2003 2005 2007 2009
protectionist pressures, as well as the possibility
Source: OECD.
of a disorderly correction of global imbalances,
Note: The emerging market indicator is a weighted average
of the composite leading indicators for Brazil, Russia and China.
may weigh on the downside.
ECB
Monthly Bulletin
July 2010
13

2 MONETARY AND FINANCIAL DEVELOPMENTS
2.1 MONEY AND MFI CREDIT
The annual growth rates of M3 and MFI loans to the private sector have remained weak in recent
months. This continues to support the assessment of moderate underlying monetary expansion and
contained inﬂ ationary pressures over the medium term. The dampening impact of the steep yield
curve on M3 growth is gradually diminishing. The subdued annual growth of MFI loans to the
private sector continues to conceal moderately positive growth in loans to households and negative
growth in loans to non-ﬁ nancial corporations. Nevertheless, monthly ﬂ ows for both sectors were
positive in May 2010. Finally, MFI balance sheet data up to May provide further evidence that,
after a contraction of total assets in 2009, the euro area MFI sector has again been accumulating
assets since the beginning of 2010.
THE BROAD MONETARY AGGREGATE M3
In May 2010 the annual growth of M3 remained weak, standing unchanged at -0.2% (see Chart 6).
This conceals a substantial negative monthly ﬂ ow, which may, however, simply have reversed part
of the strongly positive ﬂ ow of the previous month, thus conﬁ rming the generally high degree of
volatility in short-term developments over the past year and a half. Thus far, the tensions that had
emerged in some ﬁ nancial market segments in April and May do not seem to have had a visible
impact on the aggregate monetary data for the euro area as a whole. At the same time, some impact
may be discernible in the fact that the money holding sectors reduced their holdings of short and
long-term MFI debt securities relatively sharply in May.
Overall, the developments in M3 continue to be explained largely by the impact of the interest
rate constellation. The yield curve remains steep, implying a relatively high remuneration of
non-monetary interest-bearing assets, and thus
a continued incentive to allocate new funds to
assets not included in M3. But as the yield curve
Chart 6 M3 growth
has remained steep since early 2009, the outright
shifts out of M3 into longer-term instruments
(percentage changes; adjusted for seasonal and calendar effects)
in response to the steepening should now have
M3 (annual growth rate)
taken place and imply a smaller downward
M3 (three-month centred moving average of the annual
impact on M3 growth. Therefore, while headline
growth rate)
M3 (six-month annualised growth rate)
M3 growth continues to understate the pace
14
14
of underlying monetary growth, it does so to a
diminishing extent.
12
12
10
10
On the components side, the weak overall M3
8
growth in May continued to conceal substantial
8
differences between strongly positive annual
6
6
growth in M1, at 10.3%, and strongly negative
4
4
growth in other short-term deposits and
marketable instruments. On the counterparts
2
2
side, the annual growth of loans to the private
0
0
sector remained subdued, also concealing
differences between a moderate positive growth
-2
-2
1999
2001
2003
2005
2007
2009
of loans to households and the negative growth
Source: ECB.
of loans to non-ﬁ nancial corporations.
ECB
14 Monthly Bulletin
July 2010

E C O N O M I C
A N D M O N E T A R Y
D E V E L O P M E N T S
Monetary and
financial
developments
MFIs’ main assets increased somewhat further in the three-month period to May 2010, after
having picked up in the ﬁ rst quarter of the year. This reﬂ ects primarily an expansion in both
inter-MFI loans and loans to euro area non-MFIs. Overall, this provides further evidence that
euro area MFIs have been expanding their balance sheets since the beginning of 2010, after the
contraction observed in 2009.
MAIN COMPONENTS OF M3
The weak annual growth of M3 continues to conceal differences in the levels of growth of the
various components. The annual growth rate of M1 remained highly positive, while that of both
marketable instruments and short-term deposits other than overnight deposits remained deeply in
negative territory.
At the same time, recent months have seen some narrowing of this difference. The annual growth
rate of M1 declined further to 10.3% in May, down from 10.7% in the previous month (see Table 1).
This development was driven by a substantial monthly outﬂ ow from overnight deposits, which was
only partly compensated for by an inﬂ ow for currency in circulation. The outﬂ ow from overnight
deposits may reﬂ ect a reversal of the strong inﬂ ow registered in the previous month, and should
also be seen against the background of the high volatility observed in the ﬂ ows for these deposits
since the autumn of 2008.
The annual growth rate of short-term deposits other than overnight deposits increased to -8.0%
in May, from -8.6% in April. This resulted from monthly inﬂ ows of similar size for both of its
sub-components, i.e. deposits with an agreed maturity of up to two years (short-term time deposits)
and deposits redeemable at notice of up to three months (short-term savings deposits). The inﬂ ows
Table 1 Summary table of monetary variables
(quarterly ﬁ gures are averages; adjusted for seasonal and calendar effects)
Outstanding
Annual growth rates
amount as a
2009
2009
2009
2010
2010
2010
percentage of M3 1)
Q2
Q3
Q4
Q1
Apr.
May
M1
49.6
8.1
12.2
12.3
11.3
10.7
10.3
Currency in circulation
8.3
13.2
12.8
7.5
6.2
5.5
6.8
Overnight deposits
41.3
7.1
12.1
13.3
12.4
11.8
11.0
M2 – M1 (= other short-term deposits)
38.7
3.0
-3.1
-7.7
-8.2
-8.6
-8.0
Deposits with an agreed maturity of
up to two years
19.0
-0.8
-13.2
-22.1
-22.8
-22.7
-21.2
Deposits redeemable at notice
of up to three months
19.7
8.6
12.9
15.8
13.3
10.6
9.6
M2
88.3
5.6
4.5
2.2
1.7
1.3
1.4
M3 – M2 (= marketable instruments)
11.7
-2.6
-7.7
-11.4
-11.6
-9.9
-10.7
M3
100.0
4.4
2.7
0.3
-0.2
-0.2
-0.2
Credit to euro area residents
5.0
3.7
3.0
1.9
1.8
1.8
Credit to general government
9.5
12.0
14.2
9.9
8.7
9.8
Loans to general government
1.6
2.6
3.1
3.8
5.5
7.6
Credit to the private sector
4.1
2.1
0.9
0.3
0.4
0.1
Loans to the private sector
2.1
0.4
-0.6
-0.4
0.1
0.2
Loans to the private sector adjusted
for sales and securitisation
3.5
1.6
0.3
-0.2
0.1
0.2
Longer-term ﬁ nancial liabilities
(excluding capital and reserves)
4.2
4.7
6.7
5.4
5.1
3.7
Source: ECB.
1) As at the end of the last month available. Figures may not add up due to rounding.
ECB
Monthly Bulletin
July 2010
15

for short-term time deposits reﬂ ect, on the one hand, the improvement in their remuneration over
recent months and, on the other, a decline in the interest rate paid on overnight deposits, and
especially in that paid on longer-term deposits, during the same period.
After having increased for two consecutive months, the annual growth rate of marketable instruments
decreased to -10.7% in May, from -9.9% in April. This decline reﬂ ected a negative monthly outﬂ ow,
two-thirds of which was accounted for by money market funds shares/units. The remaining third
was due to a reduction of the holdings of short-term MFI debt securities (those with maturities
of up to two years) by the money holding sectors. This might be the reﬂ ection of some investors’
concerns about the sustainability of public and private sector indebtedness and its implications for
the banking systems in some countries.
The annual growth rate of M3 deposits – which comprise short-term deposits and repurchase
agreements, and represent the broadest monetary aggregate for which a reliable sectoral breakdown
is available – increased slightly in May, but continued to hover around the level of 1% that was
ﬁ rst reached in October 2009. The increase was due to a larger contribution from non-monetary
ﬁ nancial intermediaries other than insurance corporations and pension funds. The contributions of
both non-ﬁ nancial corporations and households continued to decrease slightly in May. However,
M3 deposits held by non-ﬁ nancial corporations still account for most of the annual growth of these
instruments, while the contribution of those held by households has fallen to levels close to zero.
MAIN COUNTERPARTS OF M3
Regarding the counterparts of M3, the annual growth rate of total MFI credit to euro area residents
stood at 1.8% in May, unchanged from the previous month (see Table 1). However, this development
reﬂ ects opposite movements in its two main sub-components. While the annual growth of credit to
the general government remained strong, that of credit to the private sector continued to be weak.
The annual growth rate of loans to the private sector (the largest component of credit to the private
sector) remained low, but increased marginally further for the fourth consecutive month to stand at
0.2% in May, up from 0.1% in April. As in the previous month, the impact of securitisation was
non-existent in May.
The annual growth in loans to the private sector continues to conceal signiﬁ cant differences
across the various sub-sectors. On the one hand, the annual growth rate of loans to non-ﬁ nancial
corporations remained negative in May (at -2.1%), although somewhat less so than in the month
before (see Table 2). However, a large positive monthly inﬂ ow in loans to enterprises was recorded
in May, the largest since January 2009. This inﬂ ow was driven by sizeable inﬂ ows in both
short-term loans (loans with maturities of up to one year) and long-term loans (loans with maturities
over ﬁ ve years). However, in light of the volatility recorded in recent months, it is too early to
judge whether this signals a turning point. Stronger inﬂ ows in short-term loans would be in line
with enterprises’ increased need for short-term funds to manage their inventories, given the strong
increases in inventory changes observed in the ﬁ rst few months of 2010.
On the other hand, the annual growth rate of loans to households was moderately positive in May (at
2.6%), broadly unchanged from the previous month. The evolution of loans to households continues
to reﬂ ect mainly developments in lending for house purchase. After having increased steadily in the
second half of 2009, ﬂ ows in this type of loans have stabilised over the last six months. Consumer
credit, by contrast, continued to exhibit a modest contraction (both in terms of monthly ﬂ ows and
when expressed as an annual growth rate) in May.
ECB
16 Monthly Bulletin
July 2010

E C O N O M I C
A N D M O N E T A R Y
D E V E L O P M E N T S
Monetary and
financial
developments
Table 2 MFI loans to the private sector
(quarterly ﬁ gures are averages; adjusted for seasonal and calendar effects)
Outstanding amount
Annual growth rates
as a percentage
2009
2009
2009
2010
2010
2010
of the total 1)
Q2
Q3
Q4
Q1
Apr.
May
Non-ﬁ nancial corporations
43.2
4.6
1.2
-1.4
-2.5
-2.6
-2.1
Up to one year
24.9
-2.6
-8.7
-11.9
-12.2
-10.9
-9.8
Over one and up to ﬁ ve years
19.6
9.7
4.7
-0.2
-3.3
-5.0
-5.1
Over ﬁ ve years
55.5
6.8
5.4
3.9
3.2
2.7
2.9
Households 2)
46.1
0.1
-0.1
0.3
1.7
2.5
2.6
Consumer credit 3)
12.4
-0.4
-1.0
-1.0
-0.6
-0.4
-0.4
Lending for house purchase 3)
72.0
-0.2
-0.2
0.2
2.0
2.9
3.1
Other lending
15.6
1.5
1.3
1.9
2.4
3.1
2.9
Insurance corporations and pension funds
0.8
-3.1
-6.1
-12.4
-9.3
-7.4
-7.8
Other non-monetary ﬁ nancial intermediaries
9.9
1.4
-0.0
0.2
0.2
2.3
0.5
Source: ECB.
Notes: MFI sector including the Eurosystem; sectoral classiﬁ cation based on the ESA 95.
For further details, see the relevant technical notes.
1) As at the end of the last month available. Sector loans as a percentage of total MFI loans to the private sector; maturity breakdown and
breakdown by purpose as a percentage of MFI loans to the respective sector. Figures may not add up due to rounding.
2) As deﬁ ned in the ESA 95.
3) The deﬁ nitions of consumer credit and lending for house purchase are not fully consistent across the euro area.
Overall, the latest data conﬁ rm the turning point observed in real lending to households in 2009,
which was broadly coincident with that seen in real GDP, and similar to what was often observed in
past cycles. At the same time, no clear evidence has yet emerged for a turning point in real loans to
non-ﬁ nancial corporations, which tends to lag the turning point in the overall business cycle by, on
average, almost one year.
Among the other counterparts of M3, the annual
Chart 7 Counterparts of M3
growth rate of MFI’s longer-term ﬁ nancial
liabilities (excluding capital and reserves)
decreased to 3.7% in May. This decline reﬂ ected
(annual ﬂ ows; EUR billions; adjusted for seasonal and calendar
effects)
similar developments across sub-components, as
credit to the private sector (1)
both longer-term deposits and longer-term bank
credit to general government (2)
net external assets (3)
debt securities recorded signiﬁ cant outﬂ ows
longer-term financial liabilities (excluding capital
in May. Various factors are likely to have driven
and reserves) (4)
other counterparts (including capital and reserves) (5)
these developments, including the narrowing of
M3
the difference between the interest rates paid on
1,600
1,600
longer-term deposits and those on short-term
1,400
1,400
time and savings deposits (M2-M1), which has
1,200
1,200
1,000
1,000
reduced the opportunity cost of holding the latter.
800
800
Similarly, increasing tensions in ﬁ nancial markets
600
600
may have induced some risk-averse investors
400
400
to reduce their holdings of long-term bonds
200
200
0
0
issued by MFIs resident in some countries that
-200
-200
have been affected by the sovereign debt crisis.
-400
-400
The annual growth rate of capital and reserves
-600
-600
-800
-800
rose to 7.8% in May, up from 7.6% in April.
2005
2006
2007
2008
2009
Source: ECB.
Finally, the annual inﬂ ow in MFIs’ net external
Notes: M3 is shown for reference only (M3 = 1+2+3-4+5).
Longer-term ﬁ nancial liabilities (excluding capital and reserves)
asset position was €68 billion in May, down from
are shown with an inverted sign, since they are liabilities of the
MFI sector.
€88 billion in April (see Chart 7). This reﬂ ects
ECB
Monthly Bulletin
July 2010
17

mainly base effects, since the monthly net ﬂ ow in May was positive (€11 billion). The positive
annual ﬂ ow in net external assets conceals that both the annual ﬂ ows in external assets and those
in external liabilities remained slightly negative, with the reduction in liabilities merely exceeding
that in assets.
In summary, the growth of both M3 and loans to the private sector remained weak in May.
This supports the assessment that the pace of underlying monetary expansion is moderate and
that, over the medium term, the inﬂ ationary pressures stemming from monetary developments are
contained. The steep yield curve continues to dampen headline M3 growth over and beyond what is
indicated by the underlying pace of monetary expansion, but this effect is gradually diminishing.
2.2 SECURITIES ISSUANCE
The annual growth rate of debt securities issuance continued to moderate, declining to 5.7% in
April 2010. Data on sectoral issuance activity reveal that this moderation was broadly based across
sectors and across maturities. Meanwhile, the annual growth rate of issuance of quoted shares
remained broadly unchanged.
DEBT SECURITIES
The annual growth rate of debt securities issued by euro area residents continued to moderate, falling
to 5.7% in April 2010, from 6.0% in the previous month (see Table 3). Following the downward
trend that started a year ago, the annual growth rate of short-term debt securities issuance declined
to -8.0% in April 2010. At the same time, the annual growth rate of long-term debt securities
issuance moderated to 7.6%. However, the slowdown in the six-month annualised and seasonally
adjusted growth rate of debt securities issued, which captures short-term trends better, was interrupted
in April on account of growth in issuance by monetary ﬁ nancial institutions (see Chart 8).
Table 3 Securities issued by euro area residents
Amount outstanding
Annual growth rates 1)
(EUR billions)
2010
2009
2009
2009
2010
2010
2010
Issuing sector
April
Q2
Q3
Q4
Q1
March
April
Debt securities
15,696
11.8
11.4
10.1
7.0
6.0
5.7
MFIs
5,495 5.8
4.0 2.9 1.6 1.4 1.3
Non-monetary ﬁ
nancial
corporations
3,254 30.9 26.8 21.0 10.1 7.2 6.2
Non-ﬁ
nancial
corporations
867 10.5 14.1 16.5 14.8 16.1 15.7
General
government
6,080 12.2 13.5 12.7 10.0 8.7 8.6
of which:
Central government
5,686
12.4
13.7
12.9
9.9
8.6
8.5
Other
general
government
394 9.6 9.5 10.4 10.2 11.6 10.9
Quoted
shares
4,428 1.9 2.7 2.8 2.9 2.8 2.7
MFIs
513 8.7 9.3 8.8 8.2 7.4 7.0
Non-monetary ﬁ
nancial
corporations
344 3.1 3.9 2.7 5.4 5.4 5.3
Non-ﬁ
nancial
corporations
3,571 0.8 1.6 1.9 1.9 1.8 1.7
Source: ECB.
1) For details, see the technical notes for Sections 4.3 and 4.4 of the “Euro area statistics” section.
ECB
18 Monthly Bulletin
July 2010

E C O N O M I C
A N D M O N E T A R Y
D E V E L O P M E N T S
Monetary and
financial
developments
Over recent months, reﬁ nancing activity has
Chart 8 Sectoral breakdown of debt
remained buoyant in the long-term segment,
securities issued by euro area residents
notably at ﬁ xed rates, to the detriment of
short-term debt securities issuance. In the last
(six-month annualised growth rates; seasonally adjusted)
few months, the annual growth rate of ﬁ xed rate
total
monetary financial institutions
long-term debt securities issuance has stabilised
non-monetary financial corporations
below 11%. At the same time, the annual growth
non-financial corporations
general government
rate of ﬂ oating rate long-term debt securities
70
70
issued fell below 1%.
60
60
50
50
From a sectoral perspective, the moderation in
40
40
the pace of debt securities issuance recorded
30
30
in recent months appears to be broadly based,
20
20
except for the corporate sector, where the
10
10
growth of issuance has been hovering around
0
0
historically high levels. In particular, the annual
-10
-10
1999
2001
2003
2005
2007
2009
growth rate of debt securities issued by euro
Source: ECB.
area non-ﬁ nancial corporations stood at 15.7%
in April 2010, down from 16.1% in the previous
month. High volumes and a sustained pace of net issuance of ﬁ xed rate long-term debt securities
since the end of 2008 suggest that corporations, especially large ones, have drawn resources from
capital markets, taking advantage of still favourable market conditions and potentially reacting to
the relatively strict terms and conditions on bank loans.
Despite some signs of moderation, the annual growth rate of debt securities issued by the general
government sector remained strong in April 2010, at 8.6%. This is in line with the continued
substantial funding needs of the euro area public sectors, although there has been a strong reduction
in short-term government debt securities issuance in the last few months with growth turning
negative in April.
As far as the ﬁ nancial sector is concerned, the
Chart 9 Sectoral breakdown of quoted
annual growth rate of debt securities issued
shares issued by euro area residents
by MFIs remained low in April, at 1.3%, after
1.4% in the previous month. This was due to a
(annual growth rates)
decline in the annual growth rate of long-term
total
monetary financial institutions
debt securities issued, while from a longer-term
non-monetary financial corporations
perspective, the weakness in issuance
non-financial corporations
was largely driven by a sharp contraction
12.0
12.0
in the volume of debt securities issued at
10.0
10.0
short-term maturities. The annual growth rate of
8.0
8.0
debt securities issued by non-monetary ﬁ nancial
6.0
6.0
corporations declined to 6.2% in April 2010,
4.0
4.0
from 7.2% in the previous month, owing to
2.0
2.0
deceleration in long-term issuance growth.
0.0
0.0
-2.0
-2.0
QUOTED SHARES
-4.0
-4.0
1999
2001
2003
2005
2007
2009
The annual growth rate of quoted shares
Source: ECB.
issued by euro area residents remained broadly
Note: Growth rates are calculated on the basis of ﬁ nancial
transactions.
unchanged at 2.7% in April 2010 (see Chart 9).
ECB
Monthly Bulletin
July 2010
19

Moderating somewhat compared with the previous month, the annual growth rate of equity issuance
by MFIs remained strong at 7.0% in April 2010. This reﬂ ects the efforts by banks to raise capital
in order to consolidate their balance sheets. Meanwhile, the annual growth rate of quoted shares
issued by non-ﬁ nancial corporations remained broadly unchanged at 1.7% in April, despite a surge
in the cost of equity ﬁ nancing, which reached a record high.
2.3 MONEY MARKET INTEREST RATES
Money market interest rates increased across all maturities in June and early July 2010. This mainly
reﬂ ects tensions relating to ﬁ nancial market participants’ continued concerns about sovereign risks
in some euro area countries. In order to smoothen the liquidity effect of the one-year long-term
reﬁ nancing operation maturing on 1 July (in which €442 billion were allotted), the ECB carried
out an additional six-day ﬁ ne-tuning operation on that day (in which €111.3 billion were allotted),
which followed the three-month long-term reﬁ nancing operation allotted on 30 June (in which
€131.9 were allotted). At the same time, the covered bond purchase programme that had begun on
6 July 2009 was completed in full on 30 June.
In June and early July 2010, unsecured money market rates increased further across all maturities.
On 7 July the one-month, three-month, six-month and twelve-month EURIBOR stood at 0.523%,
0.802%, 1.065% and 1.334% respectively – i.e. around 9, 9, 7 and 7 basis points higher respectively
than the levels observed on 9 June. Overall, the
spread between the twelve-month and the one-
month EURIBOR – an indicator of the slope of
Chart 10 Money market interest rates
the money market yield curve – decreased by
2 basis points in that period, standing at around
(percentages per annum; spread in percentage points; daily data)
81 basis points on 7 July (see Chart 10).
one-month EURIBOR (left-hand scale)
three-month EURIBOR (left-hand scale)
Between 9 June and 7 July, the money market
twelve-month EURIBOR (left-hand scale)
spread between the twelve-month and
rates derived from the three-month EONIA
one-month EURIBOR (right-hand scale)
swap index increased by more than the
2.0
3.0
corresponding unsecured rates. The three-month
EONIA swap rate stood at 0.55% on 7 July,
1.5
2.5
around 15 basis points higher than on 9 June.
As a result, the spread between this money
1.0
2.0
market rate and the corresponding unsecured
EURIBOR decreased to stand at 25 basis points
0.5
1.5
on 7 July, 6 basis points lower than on 9 June
(remaining relatively wide in comparison with
the level prevailing prior to the onset of the
0.0
1.0
ﬁ nancial market turmoil in August 2007).
-0.5
0.5
The interest rates implied by the prices of
three-month EURIBOR futures maturing in
-1.0
0.0
September and December 2010 and in March
May July Sep. Nov. Jan. Mar. May July
2009
2010
and June 2011 stood at 0.98%, 1.11%, 1.17%
and 1.25% respectively on 7 July, representing
Sources: ECB and Reuters.
ECB
20 Monthly Bulletin
July 2010

E C O N O M I C
A N D M O N E T A R Y
D E V E L O P M E N T S
Monetary and
financial
developments
increases of around 15, 22, 23 and 23 basis
Chart 11 ECB interest rates and the overnight
points respectively in comparison with the rates
interest rate
on 9 June.
(percentages per annum; daily data)
The EONIA was roughly stable in June.
fixed rate in the main refinancing operations
interest rate on the deposit facility
It remained at levels around 7-12 basis
overnight interest rate (EONIA)
points above the deposit facility rate of
interest rate on the marginal lending facility
0.25% (see Chart 11), with the exception
2.5
2.5
of 15 June. This was the ﬁ nal day of the
ﬁ fth maintenance period of 2010, when the
2.0
2.0
EONIA rose to 0.665% as a result of the
Eurosystem conducting a liquidity-absorbing
ﬁ ne-tuning operation by means of a variable
1.5
1.5
rate tender procedure. The operation absorbed
€363.5 billion, with a maximum rate of 0.85%,
a marginal rate of 0.80% and a weighted
1.0
1.0
average rate of 0.77%. On 1 July the ﬁ rst
one-year long-term reﬁ nancing operation
0.5
0.5
(LTRO) matured, which led to a decline in
excess liquidity. As a consequence, the EONIA
stood at 0.542% and 0.48% on 30 June and
0.0
0.0
1 July respectively. Afterwards, the EONIA
May July Sep. Nov. Jan. Mar. May July
2009
2010
remained in the range between 0.41% and
Sources: ECB and Reuters.
0.44%, and stood at 0.414% on 7 July.
In the main reﬁ nancing operations of 8, 15, 22 and 29 June and 6 July, the ECB allotted
€122 billion, €126.7 billion, €151.5 billion, €162.9 billion and €229.1 billion respectively.
As regards its longer-term operations, the ECB allotted two LTROs in June, both as a ﬁ xed rate tender
with full allotment: a one-month operation on 15 June (in which €31.6 billion were allotted) and a
three-month operation on 30 June (in which €131.9 billion were allotted). The large amount
allotted in the latter operation reﬂ ected the fact that its settlement date coincided with the
maturity date of a one-year operation (in which €442 billion were allotted). In order to further
smoothen the liquidity effect of the ﬁ rst one-year LTRO maturing on 1 July 2010, the ECB carried
out an additional six-day ﬁ ne-tuning operation with a ﬁ xed rate of 1% and full allotment on
1 July, with maturity on 7 July (coinciding with the settlement day of the next main reﬁ nancing
operation), in which €111.2 billion were allotted. In addition, the ECB conducted ﬁ ve one-week
liquidity-absorbing operations as variable rate tenders with a maximum bid rate of 1% on 8, 15, 22
and 29 June and 6 July. With the latter operation, the ECB absorbed €59 billion, which corresponds
to the size of purchases under the Securities Markets Programme, taking into account transactions
on or before 2 July 2010.
In line with the decrease in the liquidity surplus in the euro area money market after the ﬁ rst
one-year LTRO matured, average daily recourse to the deposit facility declined to stand at
€244 billion in the period from 16 June to 7 July. This was lower than the €288.8 billion observed
in the previous maintenance period, which had ended on 15 June.
The covered bond purchase programme that had begun on 6 July 2009 was completed in full on
30 June. The nominal amount of €60 billion had been purchased by the Eurosystem on the primary
and secondary markets.
ECB
Monthly Bulletin
July 2010
21

2.4 BOND MARKETS
During June and early July recurrent swings in investors´ risk appetite continued to drive
developments in global bond markets. By 7 July, AAA-rated long-term euro area government bond
yields stood at about their early June levels, while some intra-euro area sovereign bond yield spreads
widened further. In the United States, long-term government bond yields declined further over the
review period. Euro area long-term break-even inﬂ ation rates declined in June.
Between early June and 7 July the level of yields on ten-year AAA-rated ten-year government
bonds in the euro area remained stable, overall, at around 2.9%, while long-term government bond
yields in the United States declined further by 30 basis points to 3.0% (see Chart 12). As a result,
the ten-year nominal interest rate differential between US and euro area government bonds narrowed
to 10 basis points.
In June and early July global bond markets continued to reﬂ ect recurrent swings in investors’ risk
appetite. Over this period, ﬂ ight-to-safety ﬂ ows into selected government bonds triggered some
short-lived volatility in long-term government bond yields on both sides of the Atlantic. All in all,
however, market participants’ uncertainty about near-term developments in long-term bond yields,
as measured by implied bond market volatility, has declined somewhat since early June.
Ten-year US government bond yields declined over the review period as a result of recurrent
risk aversion among investors. Although investors’ concerns about the sovereign risk of some
euro area countries appeared to recede somewhat in the course of June, market concerns emerged
over the strength and sustainability of the global economic recovery. Against this background,
mixed macroeconomic data releases for the
US and other major economies during the
review period – particularly, in the case of
Chart 12 Long-term government bond yields
the United States, the renewed weakness of
the housing market, the downward revision of
(percentages per annum; daily data)
growth in the ﬁ rst quarter of 2010 and lower
euro area (left-hand scale)
consumer conﬁ dence – triggered swings in
United States (left-hand scale)
market sentiment, giving rise to some volatility
Japan (right-hand scale)
in the level of US long-term bond yields.
4.1
2.4
The Federal Reserve System statement of 3.9
2.2
24 June, in which it reiterated that policy rates
should be expected to remain low for an extended
3.7
2.0
period of time, may have also contributed to a
3.5
1.8
lower level in these bond yields.
3.3
1.6
The euro area sovereign bond markets
continued to be strongly inﬂ uenced by news
3.1
1.4
about the outlook for euro area countries with
2.9
1.2
challenging ﬁ scal positions. Although sovereign
risk concerns appeared to ease somewhat with
2.7
1.0
the announcement on the European Financial
July
Sep.
Nov.
Jan.
Mar.
May
July
2009
2010
Stabilisation Mechanism and the ECB’s Sources: Bloomberg and Reuters.
Securities Markets Programme in early May
Note: Long-term government bond yields refer to ten-year bonds
or to the closest available bond maturity.
(see Box 3 in the June 2010 issue of the Monthly
ECB
22 Monthly Bulletin
July 2010

E C O N O M I C
A N D M O N E T A R Y
D E V E L O P M E N T S
Monetary and
financial
developments
Chart 13 Euro area zero coupon
Chart 14 Euro area zero coupon break-even
inflation-linked bond yields
inflation rates
(percentages per annum; ﬁ ve-day moving averages of daily data;
(percentages per annum; ﬁ ve-day moving averages of daily data;
seasonally adjusted)
seasonally adjusted)
five-year forward inflation-linked bond yield
five-year forward break-even inflation rate
five years ahead
five years ahead
five-year spot inflation-linked bond yield
five-year spot break-even inflation rate
ten-year spot inflation-linked bond yield
ten-year spot break-even inflation rate
3.0
3.0
3.0
3.0
2.5
2.5
2.6
2.6
2.0
2.0
2.2
2.2
1.5
1.5
1.8
1.8
1.0
1.0
1.4
1.4
0.5
0.5
0.0
0.0
1.0
1.0
July
Sep.
Nov.
Jan.
Mar.
May
July
July
Sep.
Nov.
Jan.
Mar.
May
July
2009
2010
2009
2010
Sources: Reuters and ECB calculations.
Sources: Reuters and ECB calculations.
Bulletin for details), investors’ concerns Chart 15 Implied forward euro area
prevail. Despite some unwinding of the strong
overnight interest rates
ﬂ ight-to-safety ﬂ ows into high-rated euro area
sovereign bonds seen in May, some euro area
(percentages per annum; daily data)
ten-year sovereign bond spreads (vis-à-vis
7 July 2010
31 May 2010
Germany) have widened again since mid-June,
5.0
5.0
while developments and the degree of
intensiﬁ cation of tensions differed signiﬁ cantly
4.5
4.5
among the countries affected.
4.0
4.0
3.5
3.5
Yields on euro area ﬁ ve-year and ten-year
3.0
3.0
inﬂ
ation-linked government bonds rose by 2.5
2.5
almost 20 basis points to stand at 0.5% and 1.1%
2.0
2.0
respectively on July 7 (see Chart 13). In turn,
long-term implied forward real interest rates also
1.5
1.5
rose by about 20 basis points. At the same time,
1.0
1.0
ﬁ nancial indicators of medium to long-term
0.5
0.5
inﬂ ation expectations have fallen since early
0.0
0.0
June (see Chart 14). Long-term implied forward
2010
2012
2014
2016
2018
2020
break-even inﬂ ation rates (ﬁ ve years forward
Sources: ECB, EuroMTS (underlying data) and Fitch Ratings
ﬁ ve years ahead) in the euro area declined
(ratings).
Notes: The implied forward yield curve, which is derived from
by around 20 basis points to stand at 2.4%
the term structure of interest rates observed in the market, reﬂ ects
market expectations of future levels for short-term interest rates.
on 7 July. Although the effects of recurrent
The method used to calculate these implied forward yield curves
is outlined in the “Euro area yield curve” section of the ECB’s
ﬂ ight-to-safety ﬂ ows into government bonds
website. The data used in the estimate are euro area AAA-rated
government bond yields.
are likely to continue to affect the calculation of
ECB
Monthly Bulletin
July 2010
23

these rates, the decline in long-term forward inﬂ ation swap rates (to around 2.2%) also indicated
that euro area inﬂ ation expectations remain ﬁ rmly anchored.
Investors’ expectations regarding the future path of short-term interest rates in the euro area have
changed little since the end of May, with the implied forward overnight interest rate curve for euro
area government bonds remaining broadly unchanged between the beginning of June and 7 July
(see Chart 15).
2.5 INTEREST RATES ON LOANS AND DEPOSITS
Most MFI lending rates declined slightly in May 2010, recording new or being close to historical
lows for both households and non-ﬁ nancial corporations and across most maturities. All in all, the
pass-through of past reductions in key ECB interest rates to bank customers is broadly complete.
In May 2010 short-term MFI interest rates on deposits remained broadly unchanged. Developments
in lending rates were mixed but exhibited only marginal variation with respect to the previous
month: most short-term rates on loans to households declined, whereas those on loans to
non-ﬁ
nancial corporations increased slightly
or remained unchanged (see Chart 16). More
Chart 16 Short-term MFI interest rates and
precisely, average rates on overdrafts extended
a short-term market rate
to households remained unchanged at 8.8%,
while short-term rates on loans to households for
(percentages per annum; rates on new business)
house purchase continued their downward trend
deposits from households redeemable at notice
of up to three months
(falling by 4 basis points to 2.6%) and recorded a
deposits from households with an agreed maturity
historical low. The more volatile short-term rates
of up to one year
overnight deposits from non-financial corporations
on consumer credit remained almost unchanged
loans to households for consumption with a floating
at 6.8%. Regarding non-ﬁ nancial corporations,
rate and an initial rate fixation of up to one year
loans to households for house purchase with a floating
banks’ rates on overdrafts remained unchanged
rate and an initial rate fixation of up to one year
loans to non-financial corporations of over €1 million
at 4.0%, while short-term rates on small loans
with a floating rate and an initial rate fixation
(i.e. less than €1 million) picked up by 6 basis
of up to one year
three-month money market rate
points, rising from their historical low to
10
10
3.3%. Lending rates on large loans (i.e. more
than €1 million) remained at 2.0%. Since
9
9
the EURIBOR increased by 4 basis points in
8
8
May 2010, the spreads between short-term
7
7
MFI lending rates to households and those
6
6
of large loans to non-ﬁ nancial corporations
5
5
vis-à-vis the three-month money market rate
4
4
narrowed slightly (see Chart 17).
3
3
From a longer-term perspective, since the
2
2
beginning of the cycle of monetary policy
1
1
easing, which started in September 2008 and
0
0
was completed in May 2009, short-term rates
2003
2004
2005
2006
2007
2008
2009 2010
on both loans to households for house purchase
Source: ECB.
and loans to non-ﬁ nancial corporations have
ECB
24 Monthly Bulletin
July 2010

E C O N O M I C
A N D M O N E T A R Y
D E V E L O P M E N T S
Monetary and
financial
developments
Chart 17 Spreads of short-term MFI interest
Chart 18 Long-term MFI interest rates and
rates vis-à-vis the three-month money
a long-term market rate
market rate
(percentage points; rates on new business)
(percentages per annum; rates on new business)
loans to non-financial corporations of over €1 million
deposits from non-financial corporations with an
with a floating rate and an initial rate fixation of up
agreed maturity of over two years
to one year
deposits from households with an agreed maturity
loans to households for house purchase with a floating
of over two years
rate and an initial rate fixation of up to one year
loans to non-financial corporations of over €1 million
deposits from households with an agreed maturity
with an initial rate fixation of over five years
of up to one year
loans to households for house purchase with an initial
rate fixation of over five and up to ten years
seven-year government bond yield
2.5
2.5
6.0
6.0
2.0
2.0
5.5
5.5
1.5
1.5
5.0
5.0
1.0
1.0
4.5
4.5
0.5
0.5
4.0
4.0
0.0
0.0
3.5
3.5
-0.5
-0.5
3.0
3.0
-1.0
-1.0
2.5
2.5
-1.5
-1.5
2.0
2.0
2003
2004
2005
2006
2007
2008
2009
2003
2004
2005
2006
2007
2008
2009
Source: ECB
Source: ECB.
Notes: For the loans, the spreads are calculated as the lending
rate minus the three-month money market rate. For the deposits,
the spread is calculated as the three-month money market rate
minus the deposit rate.
declined by 322 and 350 basis points respectively. This compares with a decline of 433 basis points
in the three-month EURIBOR and indicates a considerable pass-through of market rate changes
to bank lending rates.
As regards longer maturities, MFI interest rates on household long-term deposits increased,
while most interest rates on longer-term loans to households and non-ﬁ nancial corporations declined
in May 2010 (see Chart 18). More precisely, interest rates on loans to households for house purchase
with an initial rate ﬁ xation of over ﬁ ve and up to ten years declined by 4 basis points to 4.1%, while
rates on loans to households for house purchase with an initial rate ﬁ xation of over ten years decreased
by 11 basis points to 4.0%. Average rates on small loans to non-ﬁ nancial corporations with an initial
rate ﬁ xation of over one year and up to ﬁ ve years and those with an initial rate ﬁ xation of over ﬁ ve
years declined slightly to stand at 4.1% and 3.9% respectively. The average rates on large loans
increased by 9 basis points to 2.8% for loans with an initial rate ﬁ xation of over one year and up to ﬁ ve
years but declined by 3 basis points to 3.4% for loans with an initial rate ﬁ xation of over ﬁ ve years.
Viewed from a longer-term perspective, since September 2008 euro area banks have adjusted
their rates on long-term loans to non-ﬁ nancial corporations more or less in line with the decline in
long-term government bond yields. By contrast, long-term rates on loans to households have not
fallen by as much over the same period, reﬂ ecting a more incomplete and sluggish pass-through for
households but also increased credit risk concerns in some parts of the euro area.
Recent developments in loan-deposit margins on outstanding amounts signal improvements
in the proﬁ tability of euro area banks. These margins have recovered with respect to the early
part of 2009, thus contributing to the pick-up in euro area banks’ proﬁ tability since the second
half of 2009.
ECB
Monthly Bulletin
July 2010
25

2.6 EQUITY MARKETS
Volatility in global stock markets remained high in June and early July. Investors’ concerns about
the sovereign debt situation in the euro area and the effective strength of the global economic
recovery continued to weigh on stock markets. As a result, amid signiﬁ cant intra-period swings,
major stock price indices ended the review period unchanged or below their end-May levels.
Investors’ uncertainty about stock market developments, as measured by implied volatility, declined
somewhat over the review period.
Since the end of May, market sentiment has continued to be volatile and triggered signiﬁ cant daily
variations in global stock markets over the review period. On 7 July the Dow Jones EURO STOXX
index was broadly unchanged with respect to its level at the end of May, while the Standard &
Poors 500 index was about 3% lower (see Chart 19). Over the same period, Japanese stock prices,
as measured by the Nikkei 225 index, fell by about 4%, also affected negatively by some adverse
economic data releases in June.
Concerns about the sovereign debt situation in the euro area and the ﬁ nancial sector, as well as
the strength of the on-going economic recovery continued to weigh on stock markets. Investors’
uncertainty about stock market developments, as measured by implied volatility, remained at
elevated levels but declined somewhat over the review period (see Chart 20).
Chart 19 Stock price indices
Chart 20 Implied stock market volatility
(index: 1 July 2009 = 100; daily data)
(percentages per annum; ﬁ ve-day moving average of daily data)
euro area
euro area
United States
United States
Japan
Japan
135
135
40
40
130
130
35
35
125
125
120
120
30
30
115
115
25
25
110
110
105
105
20
20
100
100
15
15
95
95
90
90
10
10
July Sep. Nov. Jan. Mar. May. July
July Sep. Nov. Jan. Mar. May. July
2009
2010
2009
2010
Sources: Reuters and Thomson Financial Datastream.
Source: Bloomberg.
Note: The indices used are the Dow Jones EURO STOXX broad
Notes: The implied volatility series reﬂ ects the expected standard
index for the euro area, the Standard & Poor’s 500 index for the
deviation of percentage changes in stock prices over a period of
United States and the Nikkei 225 index for Japan.
up to three months, as implied in the prices of options on stock
price indices. The equity indices to which the implied volatilities
refer are the Dow Jones EURO STOXX 50 for the euro area, the
Standard & Poor’s 500 for the United States and the Nikkei 225
for Japan.
ECB
26 Monthly Bulletin
July 2010

E C O N O M I C
A N D M O N E T A R Y
D E V E L O P M E N T S
Monetary and
financial
developments
The beginning of the review period was instead characterised by a timid recovery in global stock
markets following the May sell-off. This recovery was led mainly by ﬁ nancial stocks, in particular the
banking sector, which had suffered the most during May. The recovery turned out to be short-lived,
however, as markets’ worries about the ﬁ scal situation in some euro area countries and the
sustainability of the global economic recovery resurfaced. Against this background, mixed
macroeconomic data releases on the US economy in June – particularly the renewed weakness in the
housing market, the downward revision in growth in the ﬁ rst quarter of 2010 and lower consumer
conﬁ dence – triggered some signiﬁ cant corrections in the US and other major stock markets.
The advances in the major euro area stock price indices early in the review period were also led by
the recovery in ﬁ nancial stocks. Concerns about the increased reliance on ECB ﬁ nancing by banks
in some euro area countries mounted, however, ahead of the twelve-month Eurosystem reﬁ nancing
operation maturing on 1 July and weighed on ﬁ nancial stocks. In addition, increased uncertainty
about future growth in the light of the ﬁ scal austerity plans recently announced in most euro area
countries also appeared to have had a negative impact on euro area stock markets. In this regard,
the relatively weak readings of some conﬁ dence indicators published in June added a degree of
volatility.
Despite the somewhat unsettled market sentiment, the gradual upward adjustment of actual earnings
continued to support equity prices. For companies listed in the Dow Jones EURO STOXX index, the
annual rate of change of realised earnings was still negative in June at -4%, albeit an improvement
on the May rate of -10%. As regards the earnings outlook, analysts’ expectations for earnings per
share growth over the next 12 months and longer-term earnings expectations remained broadly
unchanged at about 25% and 13% respectively.
ECB
Monthly Bulletin
July 2010
27

3 PRICES AND COSTS
According to Eurostat’s ﬂ ash estimate, annual HICP inﬂ ation stood at 1.4% in June 2010, after
1.6% in May. In the next few months annual HICP inﬂ ation rates are expected to display some
further volatility, with a tendency towards somewhat higher rates later in the year. Looking ahead,
in 2011 inﬂ ation rates should, overall, remain moderate, beneﬁ ting from low domestic price
pressures. Risks to the outlook for price developments are broadly balanced.
3.1 CONSUMER PRICES
According to Eurostat’s ﬂ ash estimate, the euro area annual HICP inﬂ ation rate stood at 1.4%
in June 2010, down from 1.6% in May (see Table 4). Ofﬁ cial estimates of the breakdown of HICP
inﬂ ation in June are not yet available, but part of the decrease was due to a small base effect.
In May the annual growth rate of overall HICP inﬂ ation increased marginally, by 0.1 percentage
point compared with April. Increases were recorded in the annual inﬂ ation rates of all major
components, with the exception of unprocessed food (see Table 4). The year-on-year change of the
energy component stood at 9.2% in May, slightly up from the previous month, mainly driven by
oil-related items (liquid fuels for home heating and personal transportation), whose prices recorded
a further increase on a month-on-month basis, reﬂ ecting the lagged effects of oil price rises up to
early May.
The annual growth rate of total food prices (including alcohol and tobacco) remained in positive
territory for the third month in a row in May, at 0.7%. As for the sub-components, unprocessed
food prices recorded a lower, albeit still positive, annual inﬂ ation rate in May compared with the
previous month, mainly on account of a decrease in the prices of vegetables. The year-on-year
increase in unprocessed food prices was 0.4% in May, which was 0.3 percentage point lower
than in April. The increase in the annual rate of change of processed food prices to 0.9% in May,
from 0.6% one month earlier, was mainly driven by an upward base effect and recent increases
in tobacco prices.
Excluding all food and energy items, which represent around 30% of the HICP basket, annual
HICP inﬂ ation stood at 0.8% in May, unchanged from April, owing to broadly stable non-energy
Table 4 Price developments
(annual percentage changes, unless otherwise indicated)
2008
2009
2010
2010
2010
2010
2010
2010
Jan.
Feb.
Mar.
Apr.
May
June
HICP and its components
Overall index 1)
3.3
0.3
1.0
0.9
1.4
1.5
1.6
1.4
Energy
10.3
-8.1
4.0
3.3
7.2
9.1
9.2
.
Unprocessed food
3.5
0.2
-1.3
-1.2
-0.1
0.7
0.4
.
Processed food
6.1
1.1
0.6
0.6
0.5
0.6
0.9
.
Non-energy industrial goods
0.8
0.6
0.1
0.1
0.1
0.2
0.3
.
Services
2.6
2.0
1.4
1.3
1.6
1.2
1.3
.
Other price indicators
Industrial producer prices
6.1
-5.1
-1.0
-0.4
0.9
2.8
3.1
.
Oil prices (EUR per barrel)
65.9
44.6
54.0
54.5
59.1
64.0
61.6
62.2
Non-energy commodity prices
2.0
-18.5
27.3
25.4
34.5
51.9
52.1
50.5
Sources: Eurostat, ECB and ECB calculations based on Thomson Financial Datastream data.
Note: The non-energy commodity price index is weighted according to the structure of euro area imports in the period 2004-06.
1) HICP inﬂ ation in June 2010 refers to Eurostat’s ﬂ ash estimate.
ECB
28 Monthly Bulletin
July 2010

E C O N O M I C
A N D M O N E T A R Y
D E V E L O P M E N T S
Prices
and costs
Chart 21 Breakdown of HICP inflation: main components
(annual percentage changes; monthly data)
total HICP (left-hand scale)
total HICP excluding energy and unprocessed food
unprocessed food (left-hand scale)
(left-hand scale)
energy (right-hand scale)
processed food (right-hand scale)
non-energy industrial goods (left-hand scale)
services (left-hand scale)
5
25
4
8
4
20
3
6
3
15
2
10
2
4
1
5
1
2
0
0
-1
-5
0
0
-2
-10
-3
-15
-1
-2
2004
2005
2006
2007
2008
2009
2004
2005
2006
2007
2008
2009
Source: Eurostat.
industrial goods and services price inﬂ ation. The annual rate of change in non-energy industrial
goods prices increased marginally in May to 0.3%, from 0.2% in April, reﬂ ecting small increases
in a number of items, such as pharmaceuticals and jewellery. Services price inﬂ ation increased
slightly in May from the record low seen in April. The year-on-year increase in services prices
was 1.3%, i.e. 0.1 percentage point higher than in April. This increase was mainly on account
of package holidays and could, to some extent, be explained by calendar effects. This positive
contribution was partly offset by developments in the prices of other services, most notably those
related to communication.
3.2 INDUSTRIAL PRODUCER PRICES
In the past few months the annual growth rate of industrial producer prices has moved to positive
territory. In May the annual rate of change in industrial producer prices (excluding construction)
rose to 3.1%, from 2.8% in April. The increase reﬂ ects higher rates of change in all components,
due to rises in raw material prices, with the exception of energy, which was affected by a downward
base effect (see Chart 22).
Developments observed in a number of survey indicators also signal upward price pressures
(see Chart 23). With regard to the Purchasing Managers’ Index, the input price index for the
manufacturing sector weakened somewhat in June compared with the May reading, but the level
is still much above the threshold level of 50, indicating rising prices. The index for prices charged
in the manufacturing sector edged up slightly in June. In the services sector, both the input and
selling price indices remained broadly unchanged in June. The selling price index is still below the
50 mark, indicating falling prices in that sector. Overall, the survey indicators seem to suggest that
ﬁ rms are having some difﬁ culty in passing on the higher input prices to consumers.
ECB
Monthly Bulletin
July 2010
29

Chart 22 Breakdown of industrial
Chart 23 Producer input and output
producer prices
price surveys
(annual percentage changes; monthly data)
(diffusion indices; monthly data)
total industry excluding construction (left-hand scale)
manufacturing; input prices
intermediate goods (left-hand scale)
manufacturing; prices charged
capital goods (left-hand scale)
services; input prices
consumer goods (left-hand scale)
services; prices charged
energy (right-hand scale)
10
25
80
80
8
20
70
70
6
15
4
10
60
60
2
5
0
0
50
50
-2
-5
40
40
-4
-10
-6
-15
30
30
-8
-20
-10
-25
20
20
2004
2005
2006
2007
2008
2009
2004
2005
2006
2007
2008
2009
Sources: Eurostat and ECB calculations.
Source: Markit.
Note: An index value above 50 indicates an increase in prices,
whereas a value below 50 indicates a decrease.
3.3 LABOUR COST INDICATORS
The latest data on labour cost indicators suggest broadly stabilising annual growth rates in the
ﬁ rst quarter of 2010 (see Chart 24 and Table 5). As discussed in Box 1, the discrepancies between
the annual growth rates of various labour cost indicators partly emanate from developments in
hours worked.
The annual rate of growth in euro area negotiated wages declined to 1.7% in the ﬁ rst quarter of
2010, from 2.2% in the last quarter of 2009. The reduction in the euro area annual growth rate
of negotiated wages in the ﬁ rst quarter was broadly based across countries. The recent decline
conﬁ rmed that negotiated wage growth in the euro area remains on the downward path observed
since the beginning of 2009. Available information suggests that the relatively subdued negotiated
wage growth observed in the ﬁ rst quarter of 2010 continued into the second quarter, in line with
weak labour market conditions.
Table 5 Labour cost indicators
(annual percentage changes, unless otherwise indicated)
2008
2009
2009
2009
2009
2009
2010
Q1
Q2
Q3
Q4
Q1
Negotiated wages
3.3
2.7
3.2
2.8
2.4
2.2
1.7
Total hourly labour costs
3.5
2.7
3.1
3.3
2.6
1.7
2.1
Compensation per employee
3.1
1.5
1.8
1.4
1.5
1.3
1.5
Memo items:
Labour productivity
-0.2
-2.3
-3.9
-3.1
-1.9
0.0
1.9
Unit labour costs
3.3
3.9
5.9
4.7
3.5
1.3
-0.5
Sources: Eurostat, national data and ECB calculations.
ECB
30 Monthly Bulletin
July 2010

E C O N O M I C
A N D M O N E T A R Y
D E V E L O P M E N T S
Prices
and costs
In the ﬁ rst quarter of 2010 annual hourly labour
Chart 24 Selected labour cost indicators
cost growth in the euro area increased slightly
to 2.1%, from 1.7% in the fourth quarter of
2009. The rise in hourly labour costs in the ﬁ rst
(annual percentage changes; quarterly data)
quarter can be viewed as a normalisation from
compensation per employee
negotiated wages
the sharp decline recorded in the fourth quarter
hourly labour costs
of 2009, when annual hourly labour cost growth
4.5
4.5
fell by 0.9 percentage point. Even after the
small acceleration in the ﬁ rst quarter, the annual
4.0
4.0
growth rate of hourly labour costs still remains
3.5
3.5
at a level close to the historical lows observed
in 2005. The increase in annual hourly labour
3.0
3.0
cost growth in the ﬁ rst quarter primarily reﬂ ects
2.5
2.5
developments in the industrial sector, where the
annual growth rate increased to 1.8%, which
2.0
2.0
was 1.2 percentage points higher than the ﬁ gure
1.5
1.5
recorded in the previous quarter (see Chart 25).
1.0
1.0
2004
2005
2006
2007
2008
2009
Annual growth in compensation per employee
Sources: Eurostat, national data and ECB calculations.
increased slightly to 1.5% in the ﬁ rst quarter
of 2010, from 1.3% one quarter earlier. The
higher annual growth rate of negotiated wages compared to the annual growth rate of compensation
per employee in the ﬁ rst quarter indicates that the wage drift in the euro area is still negative.
The broadly stable annual rate of growth of compensation per employee, combined with a further
substantial improvement in productivity, both measured on a per head basis, caused a further substantial
slowdown in unit labour cost growth. In the ﬁ rst quarter of 2010 the annual growth rate of unit labour
costs was negative (-0.5%), down from the 1.3% increase recorded in the previous quarter, marking
a signiﬁ cant decline compared with the peak of nearly 6% reached in the ﬁ rst quarter of 2009.
Chart 25 Sectoral labour cost developments
(annual percentage changes; quarterly data)
industry excluding construction, CPE
industry excluding construction, hourly LCI
construction, CPE
construction, hourly LCI
market services, CPE
market services, hourly LCI
services, CPE
6
6
6
6
5
5
5
5
4
4
4
4
3
3
3
3
2
2
2
2
1
1
1
1
0
0
0
0
2004
2005
2006
2007
2008
2009
2004
2005
2006
2007
2008
2009
Sources: Eurostat and ECB calculations.
Note: CPE stands for “compensation per employee” and LCI stands for “labour cost index”.
ECB
Monthly Bulletin
July 2010
31

Box 1
NEW STATISTICAL SERIES OF HOURS WORKED, PRODUCTIVITY AND LABOUR COSTS FOR THE
EURO AREA
With the national accounts employment release on 15 March 2010, Eurostat, in cooperation with
EU national statistics ofﬁ ces, introduced quarterly series for hours worked for the euro area.
This is a considerable improvement in data availability and one which has been long awaited.
The “Euro area statistics” section of the Monthly Bulletin has been adapted to show the
new series.1
Deﬁ nition, coverage, timeliness and availability
The hours worked series are a mandatory part of the national accounts’ transmission programme
and will be regularly published by Eurostat, together with the national accounts employment
release, 75 days after the reference quarter.2 These data follow the ESA 95 harmonised deﬁ nitions
for actual hours worked. In accordance with International Labour Organisation standards,
“actual hours” refer to all hours spent at work, including overtime and time spent inactively
waiting due to a temporary lack of work or machinery breakdowns, but excluding all hours paid
and not worked, such as holidays or sick leave.
The hours worked data are available for the whole economy on a quarterly basis from the ﬁ rst
quarter of 2000. The euro area series are derived with 95% country coverage, excluding data
for Greece, Luxembourg, Malta and partially Belgium (only employees’ data are available).
In addition, these data are available for the main economic activity breakdowns 3 and by
employment status (employees or self-employed).
Derived indicators based on hours worked
The new series allow the compilation of estimates of hourly compensation and hourly labour
productivity. The data on hourly compensation are produced in addition to the existing labour
cost index (LCI) published by Eurostat, which is also available on an hourly basis. In terms of
the main differences between these series, hourly compensation data cover the whole economy,
while the LCI data currently do not cover agriculture, public administration, education, health and
other services not elsewhere classiﬁ ed. As a result, the two indicators are likely to diverge when
developments in these sectors differ from those in the rest of the economy. One such example is
the stronger (upward) impact on the LCI than on the aggregate (whole economy) compensation
per hour resulting from the reduction in hours worked during the recent recession, which mainly
took place in the industrial sector.4 However, while the LCI’s timeliness is similar to that of
the hours worked and total compensation data, the LCI release also provides early information
on sectoral developments (NACE Rev. 2 sections 5) and on the economic activity components
(wages and salaries, employers’ social contributions). The activity breakdown of compensation
1 See Tables 5.1.4, 5.3.2 and 5.3.3 in the “Euro area statistics” section.
2 Regulation (EC) No 1392/2007 of the European Parliament and of the Council of 13 November 2007.
3 Additional detailed activity breakdowns at the level of NACE Rev. 2 sections are available at annual frequency.
4 See Tables 5.1.4 and 5.1.5 in the “Euro area statistics” section.
5 Individual sections for Industry (NACE Rev. 2 sections B to E); Construction (NACE Rev. 2 section F); and Services (NACE Rev. 2
sections G to N).
ECB
32 Monthly Bulletin
July 2010

E C O N O M I C
A N D M O N E T A R Y
D E V E L O P M E N T S
Prices
and costs
from national accounts and therefore the respective hourly compensation breakdown only
become available at least two weeks later.
Combining the information on hourly compensation and hourly productivity allows for a more
detailed decomposition of unit labour costs than the estimates permitted hitherto on the basis of
productivity and compensation per head.6 Such analysis is especially interesting at the current
juncture and in assessing labour market developments over the recent recession. The table
shows recent developments in compensation and productivity on both a per head and a per hour
basis, as well as developments in hours worked per head, all calculated for the total economy.
Reﬂ ecting the sharp drop in hours worked per head, which started in the fourth quarter of 2008,
productivity fell more sharply on a headcount basis than per hour worked. At the same time,
growth in compensation per head slowed down due to the cut in working hours, while growth in
compensation per hour reacted with a longer lag to the economic slowdown.7 The most recent
data suggest that reductions in hours worked per head are beginning to reverse, supporting the
rebound in productivity per head.
Overall, the new series offer a clear improvement for understanding labour market developments
and complement the range of relevant indicators. In the context of its economic analysis,
the ECB monitors the full set of labour market indicators, as a means of cross-checking all
available relevant information with each indicator offering its own advantages and shedding light
on different aspects of employment, wage and productivity developments.
6 The two computations of annual unit labour cost growth, based on the per head and the per hour deﬁ nitions, should, in principle,
yield the same result, as they reﬂ ect developments in the costs of producing one unit of output. However, due to the mixed use of
data for employees and total employment in both cases (as also shown in the table), small differences may occur. These are of about a
0.1 percentage point magnitude and are thus considered insigniﬁ cant. For reasons of continuity, the ECB will continue to report unit
labour cost developments based on the per head deﬁ nition.
7 For more details on labour market adjustments in the euro area during the recent crisis, see the article entitled “Labour market
adjustments to the recession in the euro area” in this issue of the Monthly Bulletin and Box 8 entitled “Wage developments in
the euro area and the United States during the recent economic downturn: a comparative analysis” in the May 2010 issue of the
Monthly Bulletin.
Labour cost indicators: headcount and hourly developments compared
(total economy; annual percentage changes)
2008
2008
2008
2008
2009
2009
2009
2009
2010
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Compensation per head (employees)
3.2
3.2
3.4
2.8
1.8
1.4
1.5
1.3
1.5
Productivity per head (total employment)
0.7
0.2
-0.2
-1.8
-3.9
-3.1
-1.9
0.0
1.9
Compensation per hour (employees)
3.0
2.8
3.3
3.2
3.7
3.5
3.1
2.1
0.7
Productivity per hour (total employment)
0.5
0.0
-0.1
-1.4
-2.1
-1.4
-0.6
0.5
1.3
Hours worked per head (employees)
0.2
0.4
0.1
-0.4
-1.9
-2.0
-1.6
-0.7
0.7
Unit labour costs
2.5
3.0
3.6
4.7
5.9
4.7
3.5
1.3
-0.5
Sources: Eurostat and ECB calculations.
3.4 THE OUTLOOK FOR INFLATION
In the next few months annual HICP inﬂ ation rates are expected to display some further volatility,
with a tendency towards somewhat higher rates later in the year. Looking further ahead, in 2011
inﬂ ation rates should, overall, remain moderate beneﬁ ting from low domestic price pressures.
ECB
Monthly Bulletin
July 2010
33

Risks to the outlook for price developments are broadly balanced. Upside risks over the medium
term relate, in particular, to the evolution of commodity prices. Furthermore, increases in indirect
taxation and administered prices may be greater than currently expected, owing to the need
for ﬁ scal consolidation in the coming years. At the same time, risks to domestic price and cost
developments are contained.
ECB
34 Monthly Bulletin
July 2010

E C O N O M I C
A N D M O N E T A R Y
D E V E L O P M E N T S
Output,
demand and the
labour market
4 OUTPUT, DEMAND AND THE LABOUR MARKET
Economic activity has been expanding since the middle of 2009. According to Eurostat’s second
estimate, euro area real GDP grew by 0.2% in the ﬁ rst quarter of 2010. The latest data conﬁ rm
previous expectations that a strengthening in economic activity took place during the spring.
Looking ahead, euro area real GDP growth is expected to grow at a moderate and still uneven
pace across countries and sectors. The ongoing recovery at the global level, as well as the
accommodative monetary policy stance and measures adopted to restore the functioning of the
ﬁ nancial system should provide support to the euro area economy. However, the process of balance
sheet adjustment and labour market prospects are expected to dampen the pace of the recovery.
The risks to the economic outlook are viewed as broadly balanced, in an environment marked by
high uncertainty.
4.1 REAL GDP AND DEMAND COMPONENTS
The euro area economy has been expanding at a moderate pace since the middle of 2009, following
ﬁ ve consecutive quarters of decline in GDP. According to Eurostat’s second estimate, euro area
real GDP rose by 0.2%, quarter on quarter, in the ﬁ rst quarter of 2010, compared with an increase
of 0.1% in the previous quarter (see Chart 26). Available indicators suggest a strengthening in
economic activity in the spring.
In the ﬁ rst quarter of 2010 real GDP growth was driven by a positive contribution from changes in
inventories, of 1.0 percentage point, which more than compensated for the negative contribution
Chart 26 Real GDP growth and contributions
Chart 27 Retail sales and confidence
in the retail trade and household sectors
(quarter-on-quarter growth rate and quarterly percentage point
(monthly data)
contributions; seasonally adjusted)
domestic demand (excluding inventories)
total retail sales 1) (left-hand scale)
changes in inventories
consumer confidence 2) (right-hand scale)
net exports
retail confidence 2) (right-hand scale)
total GDP growth
1.5
1.5
4
40
1.0
1.0
3
30
0.5
0.5
2
20
0.0
0.0
-0.5
-0.5
1
10
-1.0
-1.0
0
0
-1.5
-1.5
-1
-10
-2.0
-2.0
-2
-20
-2.5
-2.5
-3.0
-3.0
-3
-30
Q1
Q2
Q3
Q4
Q1
2004 2005 2006 2007 2008 2009
2009
2010
Sources: Eurostat and ECB calculations.
Sources: European Commission Business and Consumer Surveys
and Eurostat.
Note: From May 2010, Commission business survey data refer
to the NACE Rev. 2 Classiﬁ cation.
1) Annual percentage changes; three-month moving averages;
working day-adjusted. Excludes fuel.
2) Percentage balances; seasonally and mean-adjusted.
ECB
Monthly Bulletin
July 2010
35

of 0.3 percentage point from domestic demand excluding inventories. The latter reﬂ ected negative
growth in private consumption and investment, while government consumption increased.
With regard to trade ﬂ ows, despite the dynamic growth of exports on the back of the strong
recovery in the world economy, the contribution of net trade to real GDP growth was also negative,
as imports grew more than exports.
Turning to the components of domestic demand, private consumption declined slightly in the ﬁ rst
quarter of 2010, on a quarterly basis, after increasing moderately in the fourth quarter of 2009.
Available indicators suggest that consumer spending remained subdued in the second quarter of
2010. Data for retail sales in April and May suggest that the quarterly growth rate in the second
quarter will most likely be negative (see Chart 27). The decline in retail sales including car
registrations is expected to be even sharper, as car registrations dropped in April and May. These
ﬁ gures conﬁ rm that the impact of car scrapping schemes has faded and the recent growth in car
registrations is now being reversed. Consumer conﬁ dence, which had trended upwards in 2009,
changed only marginally over the ﬁ rst six months of 2010 and remained at levels below its long-term
average. According to the European Commission’s consumer survey, expected major purchases,
which are an indicator of planned consumption of durable goods, were also subdued. This is in line
with past experience of adjustment during a recovery (see the box entitled “Household consumption
of durable goods during the latest recession”).
Box 2
HOUSEHOLD CONSUMPTION OF DURABLE GOODS DURING THE LATEST RECESSION
This box looks at developments in household consumption, analysing household spending on
durable goods and comparing it with spending on non-durable goods and services. Separate
analysis of these two forms of expenditure can be informative because their dynamics are likely
to differ and their determinants may exercise inﬂ uences of differing intensities. By their nature,
durable goods tend to last and can be used repeatedly, providing consumers with a ﬂ ow of services
over a number of years. Their long-lasting nature means that they have some of the attributes of
assets. For households, the decision to purchase a durable good is similar to that of a ﬁ rm making
an investment decision: ﬁ rms weigh the cost of purchasing an additional unit of capital against
the present value of the expected future income that it will generate; consumers weigh the cost of
an additional durable good against the beneﬁ ts from the ﬂ ow of services derived from the good
or from saving the income.
A key implication is that the rate of change of households’ purchases of durables is likely to
experience wider swings than the growth rate of their purchases of non-durable goods and
services. For example, a drop in expected lifetime income should prompt households to moderate
their consumption. While households adjust to the new conditions, consumption growth should
fall temporarily. For household purchases of non-durable goods and services, that adjustment can
take place relatively quickly – consumers adjust their purchasing behaviour in the light of their
new expected income. For durable goods and services, however, households must adjust their
stock of durables rather than simply the ﬂ ow of services derived from these goods. Households
may be required to make a sharper adjustment to their ﬂ ow of purchases in order to reach the
desired overall stock level of durables.
ECB
36 Monthly Bulletin
July 2010

E C O N O M I C
A N D M O N E T A R Y
D E V E L O P M E N T S
Output,
demand and the
labour market
Recent developments in household consumption of durable goods
Eurostat does not publish a breakdown of euro area private consumption into durable and
non-durable consumption, in view of the relatively low and changing country coverage. To form
a view of durable and non-durable consumption, euro area aggregates have been approximated
in this box using available country data. For recent years, the data cover over 80% of the euro
area. However, data for earlier periods have more limited coverage.
Over the past three decades the relative level of euro area households’ expenditure on durables
compared with non-durable consumption has ﬂ uctuated fairly signiﬁ cantly, generally displaying
a pro-cyclical pattern (see Chart A). In the years prior to the most recent euro area recession
consumption of durable (and semi-durable) goods was particularly strong.1 The ratio of durable
consumption to non-durable consumption in the euro area rose rapidly from the end of 2003.
Indeed, growth in purchases of durable goods accounted for about 40% of overall consumption
growth between 2005 and 2007, even though durables make up only around one-ﬁ fth of total
household expenditure on average (see Chart B).
Since the onset of the latest recession household spending on durable goods has declined rapidly.
The adjustment was initially led by car purchases, which fell sharply towards the end of 2008.
However, that decline subsequently partly reversed as ﬁ scal incentives encouraged consumers to
buy new cars. Purchases of other durable goods, nevertheless, continued to fall rapidly in 2009.
The outlook for consumption of durable goods
In past downturns, households appear to have adjusted their stock of durables relatively slowly,
despite the pronounced shifts observed in the rate of change of their purchases, with sluggish
1 In the analysis we consider durable and semi-durable goods as a single component.
Chart A Ratio of euro area consumption
Chart B Private consumption components
of durable goods relative to non-durable
consumption and real GDP growth
(percentages; annual percentage changes)
(annual percentage changes)
ratio (left-hand scale)
total private consumption
GDP growth (right-hand scale)
non-durables (left-hand scale)
durables excluding cars (left-hand scale)
cars (right-hand scale)
31
6
6
25
20
4
4
30
15
10
2
2
29
5
0
0
0
28
-5
-2
-2
-10
27
-15
-4
-4
-20
26
-6
-6
-25
1980
1985
1990
1995
2000
2005
2005
2006
2007
2008
2009
Sources: Eurostat and ECB calculations.
Sources: Eurostat and ECB calculations.
ECB
Monthly Bulletin
July 2010
37

growth in consumption of durable goods
Chart C Durable consumption and consumer
intentions to make major purchases
continuing for some time (and a sharp
decline in the ratio of durable to non-durable
(annual percentage changes; survey balance minus mean and
consumption – see Chart A). Although durable
divided by standard deviation)
consumption is difﬁ cult to forecast with any
durable consumption (left-hand scale)
intentions regarding major purchases (right-hand scale)
conﬁ dence, the pattern of adjustment observed
in the past suggests further weakness in
8
3
6
2
purchases of durable consumption goods in
4
1
the euro area in the quarters ahead. Such a
2
0
scenario would be consistent with the picture
0
-1
from the European Commission’s consumer
-2
-2
survey which shows that households remained
-4
-3
cautious about making major purchases in the
-6
-4
ﬁ rst few months of 2010 (see Chart C). As this
-8
-5
indicator typically has good leading indicator
1985
1990
1995
2000
2005
2010
properties for future purchases, it may suggest
Sources: Eurostat and European Commission.
Notes: The survey balance is taken from the European
that euro area private consumption is likely to
Commission’s consumer survey. The relevant question asks
“compared to the past twelve months, do you expect to spend more
remain relatively subdued in the near term.
or less money on major purchases over the next twelve months?”.
Gross ﬁ xed capital formation fell by 1.2%, quarter on quarter, in the ﬁ rst quarter of 2010, after
a similar decline in the previous quarter. Investment has been contracting since the second
quarter of 2008 on account of weak demand, low business conﬁ dence, negative earnings growth,
historically low capacity utilisation and tight lending standards. However, recent indicators, such
as manufacturing conﬁ dence and industrial production of capital goods, point to a gradual easing
in the pace of the contraction. The breakdown of investment for the ﬁ rst quarter of 2010 shows
that the decline in investment was again largely determined by the construction component.
This component fell at a rate of 2.1%, quarter on quarter, a stronger rate than in the previous quarter.
Non-construction investment declined by 0.3%, which is slightly less than in the fourth quarter
of 2009.
As regards available indicators of investment at the beginning of 2010, construction production in
April fell by 3.4% on a three-month moving average basis, compared with 4.2% in the ﬁ rst quarter
of 2010. As the contraction in the ﬁ rst quarter of 2010 was partly attributable to the unusually
severe weather conditions in some countries, it is likely to be reversed later in the year. Regarding
non-construction investment, industrial production of capital goods – an indicator of future
investment – rose further in April. In the coming quarters investment, and in particular the
non-construction component, are likely to improve further but to remain subdued overall.
As regards trade ﬂ ows, both imports and exports increased strongly in the ﬁ rst quarter of 2010,
by 3.8% and 2.1% respectively, quarter on quarter. Owing to the stronger increase in imports, net
trade made a negative contribution of 0.6 percentage point to real GDP growth in the ﬁ rst quarter
of 2010. Recent data suggest that euro area trade growth remained broadly stable at the beginning
of the second quarter.
Inventories made a positive contribution to quarter-on-quarter GDP growth in the ﬁ rst quarter of
2010. Looking ahead, both surveys and anecdotal evidence suggest that the pace of destocking
is continuing to slow in the euro area. As a result, inventories may continue to make a positive
contribution to euro area GDP growth in the remainder of 2010. The size of that contribution,
ECB
38 Monthly Bulletin
July 2010

E C O N O M I C
A N D M O N E T A R Y
D E V E L O P M E N T S
Output,
demand and the
labour market
however, is highly uncertain, as it depends on how quickly demand recovers and on the extent to
which ﬁ rms revise their expectations for activity. Furthermore, there is some statistical uncertainty
surrounding the way inventories are estimated.
4.2 OUTPUT, SUPPLY AND LABOUR MARKET DEVELOPMENTS
Eurostat’s second estimate conﬁ rmed that real value added increased by 0.5% quarter on quarter in
the ﬁ rst quarter of 2010. The difference vis-à-vis GDP growth is related to a sharp decline in indirect
taxes related to weak domestic consumption. This decline is not reﬂ ected in lower production,
mainly owing to strong exports and inventories. The growth rate was fuelled by accelerated activity
in the industrial sector and, albeit to a lesser extent, in the services sector, while the downturn
in the construction sector continued. In particular, value added in the industrial sector (excluding
construction) grew by 1.9% on a quarterly basis, up from the 0.6% growth rate recorded in the last
quarter of 2009. Services value added increased by 0.4% in the ﬁ rst quarter of 2010, after 0.1% in
the previous quarter. Value added in the construction sector fell by 2.3% in the ﬁ rst quarter of 2010,
compared with the previous quarter, partly as a result of unfavourable weather conditions.
Industrial production excluding construction and industrial new orders continued to grow in April.
These developments suggest robust growth in both indicators in the second quarter of 2010, at levels
similar to the previous quarter (see Chart 28). Survey information suggests that economic activity
Chart 28 Industrial production growth
Chart 29 Industrial production, industrial
and contributions
confidence and the PMI
(growth rate and percentage point contributions; monthly data;
(monthly data; seasonally adjusted)
seasonally adjusted)
capital goods
industrial production 1) (left-hand scale)
consumer goods
industrial confidence 2) (right-hand scale)
intermediate goods
PMI 3) (right-hand scale)
energy
total excluding construction
5.0
5.0
4
8
4.0
4.0
3
4
3.0
3.0
2
0
2.0
2.0
1
-4
1.0
1.0
0
-8
0.0
0.0
-1.0
-1.0
-1
-12
-2.0
-2.0
-2
-16
-3.0
-3.0
-3
-20
-4.0
-4.0
-4
-24
-5.0
-5.0
-5
-28
-6.0
-6.0
-6
-32
-7.0
-7.0
-8.0
-8.0
-7
-36
-9.0
-9.0
-8
-40
2004 2005 2006 2007 2008 2009
2004 2005 2006 2007 2008 2009
Sources: Eurostat and ECB calculations.
Sources: Eurostat, European Commission Business and
Notes: Data shown are calculated as three-month moving
Consumer Surveys, Markit and ECB calculations.
averages against the corresponding average three months earlier.
Notes: Survey data refer to manufacturing. From May 2010,
Commission business survey data refer to the NACE Rev. 2
Classiﬁ cation.
1) Three-month-on-three-month percentage changes.
2) Percentage balances.
3) Purchasing Managers’ Index; deviations from an index value
of 50.
ECB
Monthly Bulletin
July 2010
39

continued to expand in the second quarter of 2010. The Purchasing Managers’ Index (PMI) for the
manufacturing sector increased further to over 56 in the second quarter of 2010 (a reading over 50
means that activity is increasing in the sector), reaching levels last seen in the second quarter of
2006 (see Chart 29). The PMI survey also provided positive indications about new orders, as the
relevant index remained over 57 in the second quarter of 2010. As regards the services sector, the
PMI index for business activity increased again in the second quarter of 2010, after declining in the
previous quarter, and returned to the level last reached in the third quarter of 2007. Other business
surveys, such as the European Commission’s business surveys, conﬁ rm indications provided by the
PMI that economic sentiment is improving. In particular, compared with the ﬁ rst quarter of 2010, it
strengthened in all sectors in the second quarter, except in construction where it was unchanged.
LABOUR MARKET
Recent information suggests that conditions in the euro area labour markets have stabilised.
According to Eurostat’s second release, euro area employment was stable, on a quarterly basis,
in the ﬁ rst quarter of 2010. This is an improvement on previous quarters, when employment fell
sharply. However, the previous substantial decline in employment was smaller in the euro area than
in the United States (see the box entitled “A comparison of employment developments in the euro
area and the United States).
Box 3
A COMPARISON OF EMPLOYMENT DEVELOPMENTS IN THE EURO AREA AND THE UNITED STATES
The recent economic and ﬁ nancial turmoil has had a heavy impact on labour markets on both
sides of the Atlantic, resulting in sharp contractions in employment and notable increases in
unemployment. This box compares the recent experiences of the two economies and examines
the policy implications of recent labour market adjustments.
It is well known that labour market developments tend to lag economic activity. Moreover,
direct comparisons between the euro area and the United States are further complicated
by the fact that the effects of the ﬁ nancial turmoil and the ensuing downturn were felt in the
United States somewhat earlier than in the euro area, with US quarterly GDP growth slowing
sharply from the third quarter of 2007, while output growth in the euro area remained resilient
until the ﬁ rst quarter of 2008. Overall, however, it seems that the contraction in economic activity
was rather larger in the euro area than in the United States, with a peak-to-trough decline in real
GDP of the order of 5.3% in the euro area, compared with 3.7% in the United States.1 In the
United States, the sharp contraction in output appears to have triggered a very rapid adjustment
in employment, with few signs of stabilisation until late 2009 (see Chart A). In the euro area,
by contrast, employment appears to have been rather slower to react and has not adjusted to the
same extent, despite the relatively larger contraction in economic activity.
1 The US recession began ofﬁ cially in the ﬁ nal quarter of 2007, according to the US National Bureau of Economic Research (NBER) –
a half year ahead of the recession in the euro area. However, US GDP growth turned negative only in the ﬁ rst quarter of 2008 and
indeed GDP grew again in the second quarter of 2008 when the level of GDP actually peaked, as output was strongly boosted by a
range of ﬁ scal stimuli. In the peak-to-trough computation mentioned in the text, the peak refers to the fourth quarter of 2007.
ECB
40 Monthly Bulletin
July 2010

E C O N O M I C
A N D M O N E T A R Y
D E V E L O P M E N T S
Output,
demand and the
labour market
Chart A Evolution of total hours worked in the business sector and contributions
(annual percentage changes; percentage point contributions)
Euro area
United States
average hours worked per person employed
average hours worked 1)
employment
employment 1)
total hours worked
total hours worked
4
4
4
4
2
2
2
2
0
0
0
0
-2
-2
-2
-2
-4
-4
-4
-4
-6
-6
-6
-6
-8
-8
-8
-8
2005
2006
2007
2008
2009
2005
2006
2007
2008
2009
Sources: Eurostat, the US Bureau of Labor Statistics and ECB calculations.
Note: The business sector excludes non-market services (including the public sector).
1) US employment data refer to the total number of jobs held (and thus may include a small proportion of people with more than one job).
Developments in employment, hours worked and unemployment
Overall, since the onset of the recession in the United States more than 8 million jobs have been
lost (i.e. around 6.0% of the total prior to the recession). By contrast, in the euro area employment
has fallen by around 3.9 million (i.e. 2.6%) since the start of the recession.2 Both economies
have experienced a sharp reduction in total hours worked, although the overall decline has
clearly been much larger in the United States.3 Moreover, there has been a signiﬁ cant difference
in the relative contributions from employment losses and working hour adjustments across the
two economies. In both economies, ﬁ rms have responded to the recession by reducing the
average working hours of employees. But in the United States this effect has been dwarfed by
the much greater contribution of job shedding to the reduction in total hours worked, while in the
euro area (particularly in the industrial sector) proportionally more of the reduction in total hours
worked has been achieved through reductions in the average weekly hours of employees.
In addition to these labour demand dynamics, both economies have seen signiﬁ cant adverse
labour supply effects following the recent economic downturn. In the euro area, the stagnation
in labour force growth since the third quarter of 2008 can be almost equally attributed to both
slower population and participation growth.4 By contrast, in the United States the contraction in
the labour force (-0.2% since the third quarter of 2008) can be exclusively attributed to a very
2 For important methodological differences in the compilation of employment data in the euro area and the United States,
see the article entitled “Comparability of statistics for the euro area, the United States and Japan” in the April 2005 issue of the
Monthly Bulletin.
3 For details on the new euro area national accounts-based hours series, see the box entitled “New statistical series of hours worked,
productivity and labour costs for the euro area” and the article entitled “Labour market adjustments to the recession in the euro area”
in this issue of the Monthly Bulletin.
4 See the box entitled “Recent labour supply developments” in the June 2010 issue of the Monthly Bulletin.
ECB
Monthly Bulletin
July 2010
41

sharp fall in the participation rate, as many
Chart B Unemployment rate
workers have been discouraged from seeking
work by reduced employment prospects, (percentages of the labour force)
while US population growth moderated only
euro area
slightly.
United States
11
11
The different reactions in employment and
10
10
labour force dynamics in the two economies
have led to a much slower increase in
9
9
registered unemployment in the euro area –
8
8
albeit from a higher initial level. Thus, in the
7
7
euro area, the unemployment rate rose from
the March 2008 low of 7.8% to 10.0% by the
6
6
end of May 2010 (see Chart B). Meanwhile,
5
5
the jump in the US unemployment rate has
4
4
been considerably greater, having more than
2005
2006
2007
2008
2009
doubled from 4.8% in February 2008 to a peak
Sources: Eurostat, the US Bureau of Labour Statistics and ECB
calculations.
of 10.1% in October 2009.
There are a number of reasons which may help to explain the lower employment losses observed
thus far in the euro area relative to the United States. These include the earlier onset of the downturn
in activity in the United States compared with the euro area, as well as the greater exposure of
the US economy to sectoral shocks in the construction, real estate and ﬁ nancial sectors. In part,
they may also stem from differences in deﬁ nitions (with the United States counting the numbers
of jobs held, whereas euro area data reﬂ ect the numbers of persons employed); but disparities
in deﬁ nitions alone cannot explain the very large increase observed in US unemployment. Part
of this divergence can be understood in terms of the heavier reliance on reductions in working
hours as the main means for adjusting employment in many euro area countries.5 In several euro
area countries, these measures were also supported by government subsidies. Such policies were
broadly welcomed by ﬁ rms anxious to retain skilled workers – particularly in those countries
where skills shortages had been observed in the years preceding the recession. Finally, the stronger
employment protection legislation in the euro area is also likely to have played an important
role in delaying the labour market adjustment to what was initially perceived in many euro area
economies as being to some extent a temporary disruption to demand.
Policy implications
Both economies’ labour markets appear to have shown signs of stabilisation in recent months
(with euro area unemployment levelling off and US unemployment slightly down from its
October 2009 peak). However, it is likely to be some time before employment growth picks
up substantially. It will be necessary to ensure that the recent deterioration in labour markets
does not lead to higher structural unemployment. Longer-term improvements – and future
employment growth – are likely to depend heavily on the ability of the economies to reorganise
and restructure in the face of major sectoral shifts.
5 The use of short-time working programmes in many euro area countries increased sharply during the recession (applying, at its peak,
to around 4% of employees in Germany and Italy), whereas similar schemes applied to only around 0.5% of the US labour force.
See IMF, World Economic Outlook, Chapter 3, “Unemployment Dynamics during Recessions and Recoveries: Okun’s Law and
Beyond”, 2010.
ECB
42 Monthly Bulletin
July 2010

E C O N O M I C
A N D M O N E T A R Y
D E V E L O P M E N T S
Output,
demand and the
labour market
For the euro area, this process of restructuring is likely to require further reforms in both
labour and product markets to enhance activity and thereby employment prospects.
Further structural reforms and a timely dismantling of crisis policy measures – including
the continuing reliance on subsidised short-time working schemes in some countries – will
facilitate the reallocation of labour to more productive sectors. In this respect, an easing of
employment protection legislation for permanent workers would, in several countries, help
to alleviate some of the existing labour market dualism and encourage rehiring. Efforts to
enhance wage ﬂ exibility – allowing for sufﬁ cient differentiation to reﬂ ect local labour market
conditions, ﬁ rms’ competitive situations and local productivity levels – would help to address
remaining imbalances and further stimulate labour demand. In product markets, enhanced
competition would foster innovation and the implementation of efﬁ cient working practices.
At a sectoral level, industry (excluding construction) and construction continued to bear the brunt
of aggregate employment reductions in the ﬁ rst quarter of 2010, although the pace of the reduction
declined in industry excluding construction (see Chart 30 and the article entitled “Labour market
adjustments to the recession in the euro area” in this issue of the Monthly Bulletin). Employment in
the construction sector saw a stronger decline than in the previous quarter, owing to the unusually
severe weather conditions in some countries. By contrast, services sector employment increased
in the ﬁ rst quarter of 2010 after declining or remaining unchanged in the previous four quarters.
The improvement on the previous quarter was evident in all services sub-sectors (see Table 6).
Eurostat data on quarterly hours worked in the euro area show only a minor reduction in the ﬁ rst
quarter of 2010, despite the sharp decline recorded in construction and in industry excluding
construction (see the box in Section 3 entitled “New statistical series of hours worked, productivity
and labour costs for the euro area”).
Together with the recovery in euro area output growth, the job losses seen in recent quarters
have contributed to an inﬂ ection in the decline in productivity. In year-on-year terms, aggregate
euro area productivity (measured as output per employee) increased further in the ﬁ rst
quarter of 2010, to 1.9%, marking a substantial improvement compared with the ﬂ at growth
Table 6 Employment growth
(percentage changes compared with the previous period; seasonally adjusted)
Annual rates
Quarterly rates
2008
2009 2009 2009
2009
2009
2010
Q1
Q2
Q3
Q4
Q1
Whole economy
0.7
-1.9
-0.8
-0.5
-0.5
-0.2
0.0
of which:
Agriculture and ﬁ shing
-1.8
-2.2
-0.6
-0.7
-1.2
0.3
0.1
Industry
-0.7
-5.6
-1.8
-1.6
-1.7
-0.9
-1.1
Excluding construction
0.0
-5.1
-1.7
-1.7
-1.7
-1.1
-0.9
Construction
-2.3
-6.7
-2.2
-1.3
-1.7
-0.4
-1.5
Services
1.4
-0.6
-0.5
-0.1
-0.1
0.0
0.4
Trade and transport
1.2
-1.8
-0.8
-0.5
-0.3
-0.6
0.0
Finance and business
2.3
-2.2
-1.2
-0.7
-0.5
0.2
0.5
Public administration 1)
1.1
1.3
0.1
0.4
0.3
0.2
0.5
Sources: Eurostat and ECB calculations.
1) Also includes education, health and other services.
ECB
Monthly Bulletin
July 2010
43

Chart 30 Employment growth and employment expectations
(annual percentage changes; percentage balances; seasonally adjusted)
employment growth in industry excluding construction
employment expectations in construction
(left-hand scale)
employment expectations in the retail trade
employment expectations in manufacturing
employment expectations in the services sector
(right-hand scale)
2
20
20
20
1
10
15
15
0
0
10
10
-1
-10
5
5
-2
-20
0
0
-3
-30
-5
-5
-4
-40
-10
-10
-5
-50
-15
-15
-6
-60
-20
-20
-7
-70
-25
-25
2004 2005 2006 2007 2008 2009
2004 2005 2006 2007 2008 2009
Sources: Eurostat and European Commission Business and Consumer Surveys.
Notes: Percentage balances are mean-adjusted. From May 2010, Commission business survey data refer to the NACE Rev. 2 Classiﬁ cation.
in the previous quarter and the record contractions seen in the ﬁ rst half of 2009 (see Chart 31).
Developments in productivity per hour worked have exhibited a similar pattern, rising a further
1.3% year on year in the ﬁ rst quarter of 2010.
The euro area unemployment rate was 10.0% in May, unchanged from the previous month. The
ﬁ gure for April was revised downwards slightly by one-tenth of a percentage point (see Chart 32),
Chart 31 Labour productivity
Chart 32 Unemployment
(annual percentage changes)
(monthly data; seasonally adjusted)
whole economy
monthly change in thousands (left-hand scale)
industry excluding construction
percentage of the labour force (right-hand scale)
services
10
10
600
11.0
8
8
500
6
6
4
4
400
10.0
2
2
300
0
0
-2
-2
200
9.0
-4
-4
100
-6
-6
-8
-8
0
8.0
-10
-10
-100
-12
-12
-14
-14
-200
7.0
2004 2005 2006 2007 2008 2009
2004 2005 2006 2007 2008 2009
Sources: Eurostat and ECB calculations.
Source: Eurostat.
ECB
44 Monthly Bulletin
July 2010

E C O N O M I C
A N D M O N E T A R Y
D E V E L O P M E N T S
Output,
demand and the
labour market
and currently stands at its highest level since August 1998. Looking ahead, survey indicators have
improved from their low levels, suggesting a stabilisation in euro area unemployment in the months
ahead (see Chart 30).
4.3 THE OUTLOOK FOR ECONOMIC ACTIVITY
Looking ahead, euro area real GDP growth is expected to grow at a modest and still uneven pace
across countries and sectors. The ongoing recovery at the global level, as well as the accommodative
monetary policy stance and measures adopted to restore the functioning of the ﬁ nancial system
should provide support to the euro area economy. However, the process of balance sheet adjustment
and labour market prospects are expected to dampen the pace of the recovery.
The risks to the economic outlook are seen as broadly balanced, in an environment marked by high
uncertainty. On the upside, both the global economy and foreign trade may recover more strongly
than projected. On the downside, concerns remain with respect to renewed tensions in ﬁ nancial
markets, a stronger or more protracted than previously expected negative feedback loop between
the real economy and the ﬁ nancial sector, renewed increases in oil and other commodity prices,
protectionist pressures and the possibility of a disorderly correction of global imbalances.
ECB
Monthly Bulletin
July 2010
45

5 EXCHANGE RATE AND BALANCE OF PAYMENTS
DEVELOPMENTS
5.1 EXCHANGE RATES
Over the three months to 7 July the euro depreciated in nominal effective terms by 4.8%, moving
further below its average level in 2009. The weakening of the euro was broadly based.
EFFECTIVE EXCHANGE RATE OF THE EURO
On 7 July the nominal effective exchange rate of the euro – as measured against the currencies of
21 of the euro area’s most important trading partners – was 4.8% lower than at the end of March
and 8.9% below its average level in 2009 (see Chart 33). The depreciation of the euro was broadly
based and accompanied by an increase in the implied volatility of the bilateral exchange rates of the
euro vis-à-vis other major currencies.
US DOLLAR/EURO
In the three-month period to 7 July the euro, notwithstanding some appreciation in the latest month
of the reference period, weakened against the US dollar, reaching a level last seen in early 2006 and
well below the 2009 average (see Chart 34). On 7 July the euro traded at USD 1.26, 6.8% lower
than at the end of March and around 10% below its 2009 average.
Chart 33 Euro effective exchange rate (EER-21) and its decomposition 1)
(daily data)
Index: Q1 1999 = 100
Contributions to EER-21 changes 2)
From 31 March 2010 to 7 July 2010 (percentage points)
108
108
1
1
0
0
106
106
-1
-1
104
104
-2
-2
102
102
-3
-3
100
100
-4
-4
98
98
-5
-5
April
May
June
USD
JPY
CHF
OMS
EER-21
2010
GBP
CNY
SEK
other
Source: ECB.
1) An upward movement of the index represents an appreciation of the euro against the currencies of 21 of the most important trading
partners of the euro area (including all non-euro area EU Member States).
2) Contributions to EER-21 changes are displayed individually for the currencies of the six main trading partners of the euro area.
The category “Other Member States” (OMS) refers to the aggregate contribution of the currencies of the non-euro area Member States
(except the pound sterling and the Swedish krona). The category “other” refers to the aggregate contribution of the remaining six trading
partners of the euro area in the EER-21 index. Changes are calculated using the corresponding overall trade weights in the EER-21 index.
ECB
46 Monthly Bulletin
July 2010

E C O N O M I C
A N D M O N E T A R Y
D E V E L O P M E N T S
Exchange rate
and balance
of payments
developments
Chart 34 Patterns in exchange rates
Chart 35 Patterns in exchange rates
and implied volatilities
in ERM II
(daily data)
(daily data; deviation from the central parity in percentage points)
Exchange rates
EEK/EUR
DKK/EUR
USD/EUR (left-hand scale)
LTL/EUR
JPY/EUR (right-hand scale)
LVL/EUR
1.4
135
15
15
12
12
1.3
125
9
9
6
6
3
3
1.2
115
0
0
-3
-3
1.1
105
April
May
June
-6
-6
2010
-9
-9
GBP/EUR (left-hand scale)
-12
-12
CHF/EUR (right-hand scale)
-15
-15
1.0
1.60
April
May
June
2010
1.55
0.9
Source: ECB.
1.50
Notes: A positive (negative) deviation from the central rate
against the euro implies that the currency is on the weak (strong)
0.8
1.45
side of the band. In the case of the Danish krone, the ﬂ uctuation
band is ±2.25%; for all other currencies, the standard ﬂ uctuation
band of ±15% applies.
1.40
0.7
1.35
JAPANESE YEN/EURO
0.6
1.30
April
May
June
Over the three months to 7 July the euro
2010
depreciated vis-à-vis the Japanese yen. On 7 July
it stood at JPY 109.3, 13.0% weaker than at the
Implied exchange rate volatilities (three-month)
end of March and 15.9% below its 2009 average.
USD/EUR
GBP/EUR
Over the same three-month period the implied
JPY/EUR
volatility of the JPY/EUR exchange rate sharply
24
24
increased both at the short-term and long-term
22
22
horizons (see Chart 34).
20
20
18
18
EU MEMBER STATES’ CURRENCIES
16
16
Over the three-month period to 7 July the
14
14
currencies participating in ERM II remained
12
12
broadly stable against the euro, trading at,
10
10
or close to, their respective central rates
8
8
April
May
June
(see Chart 35). At the same time the Latvian lats
2010
remained on the weak side of the unilaterally set
Sources: Bloomberg and ECB.
ﬂ uctuation band of ±1%.
As regards the currencies of the EU Member States not participating in ERM II, the euro depreciated
by 6.5% vis-à-vis the pound sterling in the three months to 7 July, trading on 7 July at GBP 0.83.
Over the same period the euro strengthened against the Hungarian forint (by 7.0%) and the Polish
zloty (by 6.6%).
ECB
Monthly Bulletin
July 2010
47

OTHER CURRENCIES
The euro sharply weakened vis-à-vis the Swiss franc, falling by 6.8% over the three months to 7 July,
to CHF 1.33. Over the same period the bilateral euro exchange rates vis-à-vis the Chinese renminbi
and the Hong Kong dollar still moved in line with the USD/EUR exchange rate. On 19 June the
People’s Bank of China announced measures to enhance the ﬂ exibility of the exchange rate of the
renminbi (see Box 4).
Box 4
CHINA’S REFORM OF THE RENMINBI EXCHANGE RATE REGIME
Following almost two years of the renminbi being de facto pegged to the US dollar (USD),
on 19 June 2010 the People’s Bank of China (PBC) announced that it intends “to proceed further
with reform of the renminbi (RMB) exchange rate regime and to enhance the RMB exchange
rate ﬂ exibility”.1 In particular, continued emphasis will be placed on “reﬂ ecting market supply
and demand with reference to a basket of currencies”. The PBC also speciﬁ ed that “the basis for
large-scale appreciation of the RMB exchange rate does not exist”, given the fact that China’s
current account is “moving closer to equilibrium”.
It is too early to assess how the PBC will manage the exchange rate in practice under the new
regime. Looking at market expectations, non-deliverable forward contracts currently price a
less than 2% appreciation of the renminbi vis-à-vis the USD in one year’s time (see Chart A).
The PBC is also expected to allow for increased volatility in the RMB-USD bilateral exchange
rate in order to mitigate speculative capital inﬂ ows. The PBC announcement did not, however,
lead to any change in China’s de jure exchange
rate regime. Since the reform of July 2005,
Chart A RMB non-deliverable forward
this regime has been deﬁ ned by the Chinese
contracts’ implicit appreciation vis-à-vis
the USD
authorities as a managed ﬂ oat based on market
supply and demand with reference to a basket
(percentages)
of currencies.
NDF implicit appreciation (one year ahead)
15
15
While the currency weights in the RMB basket
are not disclosed, several studies looking at
10
10
movements of the RMB against the USD
concluded that the RMB has, in practice,
5
5
been closely managed to reﬂ ect movements in
the USD over the last ﬁ ve years, in the form
of either a crawling peg (from July 2005 until
0
0
July 2008) or a ﬁ xed peg (from July 2008
until June 2010). In the ﬁ rst period, the RMB
-5
-5
steadily appreciated against the USD, gaining
around 21% in bilateral terms (see Chart B).
-10
-10
However, the appreciation of the RMB in
2007
2008
2009
2010
nominal effective terms was only about 8%,
Source: Bloomberg.
Notes: A negative number indicates a depreciation. Last
mainly on account of the pace of appreciation
observation: 7 July 2010.
1 Excerpts taken from the PBC’s public announcement on 19 June.
ECB
48 Monthly Bulletin
July 2010

E C O N O M I C
A N D M O N E T A R Y
D E V E L O P M E N T S
Exchange rate
and balance
of payments
developments
of the euro against the USD. In the summer
Chart B RMB exchange rate
of 2008, given the worsening of the external
outlook and the unfolding of the global
(cumulative percentage changes since 20 July 2005; daily data)
ﬁ nancial crisis, the Chinese authorities decided
RMB/USD
to halt the RMB’s steady appreciation against
NEER
the USD. Nonetheless, since December 2009
RMB/EUR
the RMB has appreciated further, by 5.0%
25
25
in nominal effective terms, by 1.4% against
20
20
the yen, and by 17.1% vis-à-vis the euro. Along
15
15
with the broad-based depreciation of the euro,
10
10
the price competitiveness of Chinese exporters
has deteriorated in euro area markets.
5
5
0
0
As the Chinese authorities have emphasised,
-5
-5
the recovery of Chinese exports in 2010 has
also played a key role in driving the recent
-10
-10
exchange rate decision, alongside domestic -15
-15
2005
2006
2007
2008
2009
economic developments. In particular, the
recent build-up of inﬂ ationary pressures –
Source: Bloomberg.
Notes: NEER is the nominal effective exchange rate of the RMB;
including in the property market – made the
index: 2000 = 100. Last observation: 7 July 2010.
costs associated with a ﬁ xed exchange rate with
the USD higher. An appreciating RMB may help to moderate inﬂ ationary pressures emanating
from external sources and will also give the PBC greater scope to use monetary policy tools to
ﬁ ght inﬂ ation while managing a soft landing of the economy.
5.2 BALANCE OF PAYMENTS
Chart 36 Extra-euro area trade in goods
Extra-euro area trade in goods continued to
strengthen in recent months. In the year to April
(three-month-on-three-month percentage changes; for goods
balance, EUR billions and three-month moving averages;
the 12-month cumulated current account deﬁ cit
monthly data; working day and seasonally adjusted)
of the euro area narrowed to €32.3 billion
goods balance
goods exports
(around 0.4% of euro area GDP). In the
goods imports
ﬁ nancial account, net inﬂ ows in combined direct
15
15
and portfolio investment fell to a cumulative
€160.8 billion in the year to April.
10
10
5
5
TRADE AND THE CURRENT ACCOUNT
Amid improving global economic conditions,
0
0
extra-euro area trade in goods continued to
strengthen in recent months. According to
balance of payments data, extra-euro area
-5
-5
export values of goods increased by 8.4% in
the three-month period to April (see Chart 36
-10
-10
and Table 7). The ongoing export expansion
primarily reﬂ
ected robust external demand,
-15
-15
2007 2008 2009
partly owing to temporary factors such as ﬁ scal
Source: ECB.
stimuli and the inventory cycle in the economies
ECB
Monthly Bulletin
July 2010
49

Table 7 Main items of the euro area balance of payments
(seasonally adjusted data, unless otherwise indicated)
Three-month moving
12-month cumulated
average ﬁ gures ending
ﬁ gures ending
2010
2010
2009
2009
2010
2010
2009
2010
Mar.
Apr.
July
Oct.
Jan.
Apr.
Apr.
Apr.
EUR billions
Current
account
1.5 -5.1 -1.3 -4.9 -1.9 -2.7
-153.8 -32.3
Goods
balance
3.4 1.3 6.3 2.5 4.1 3.3 -23.0 48.9
Exports
126.5 124.5 107.3 104.8 113.7 123.3 1,459.0
1,347.4
Imports
123.1 123.2 101.0 102.2 109.6 120.0 1,482.0
1,298.5
Services
balance
4.5 3.6 1.8 3.1 3.3 3.9 34.5 35.9
Exports
40.1 40.1 38.4 38.5 39.7 39.6 504.5 468.6
Imports
35.6 36.6 36.6 35.4 36.4 35.8 470.0 432.7
Income
balance
-0.8 -2.7 -2.7 -2.8 -3.5 -1.7 -65.1 -31.8
Current
transfers
balance
-5.5 -7.3 -6.7 -7.7 -5.8 -8.2
-100.2 -85.2
Financial account 1)
-1.0 8.2 -8.9 2.8 3.1 3.9
192.7 2.6
Combined net direct and portfolio
investment
-40.5 18.5 16.5 26.3 15.4 -4.6 232.7 160.8
Net direct investment
-24.2
-11.3
0.0
-11.3
-2.6
-11.6
-164.6
-76.8
Net
portfolio
investment
-16.3 29.9 16.5 37.6 18.1 7.0 397.4 237.6
Equities
-5.7 -8.1 26.9 -1.0 21.9 -3.0 -114.3 134.4
Debt instruments
-10.6
38.0
-10.4
38.6
-3.8
10.0
511.6
103.2
Bonds and notes
-8.5
32.0
-14.2
18.1
-6.9
7.5
221.9
13.5
Money market instruments
-2.1
6.0
3.8
20.5
3.1
2.4
289.7
89.6
Net
other
investment
43.2 -10.1 -28.7 -21.6 -16.1 -28.7 -52.2 -165.9
Percentage changes from previous period
Goods and services
Exports
5.6 -1.2 -0.3 -1.7 7.1 6.2 -5.2 -7.5
Imports
6.6 0.6 -3.4 0.0 6.1 6.6 -1.7
-11.3
Goods
Exports
6.3 -1.6 1.0 -2.4 8.5 8.4 -6.7 -7.7
Imports
8.3 0.1 -3.8 1.2 7.2 9.5 -2.9
-12.4
Services
Exports
3.4 0.2 -3.6 0.1 3.2 -0.2 -0.7 -7.1
Imports
1.2 2.7 -2.1 -3.4 3.0 -1.9 2.3 -7.9
Source: ECB.
Note: Figures may not add up due to rounding.
1) Figures refer to balances (net ﬂ ows). A positive (negative) sign indicates a net inﬂ ow (outﬂ ow). Not seasonally adjusted.
of the euro area’s trading partners. Furthermore, gains in export price competitiveness underpinned
by the depreciation of the euro may have also had a positive effect on extra-euro area exports.
At the same time, growth in extra-euro area imports of goods continued to outpace export growth.
In the three-month period to April, values of goods imports rose by 9.5%. The breakdown of
extra-euro area import values into volumes and prices, available from Eurostat up to March, indicates
that this rise in import values of goods largely reﬂ ects a surge in import prices (see Chart 37).
This, in turn, is partly attributed to the depreciation of the euro and the pick-up in commodity
prices. Meanwhile, volumes of goods imports also grew at a strong pace, supported, among other
factors, by export-induced demand for imported inputs and inventory adjustment.
By contrast with extra-euro area trade in goods, trade in services appears to have lost further
momentum. Following an expansion observed around the turn of the year, export and import values
of services declined by 0.2% and 1.9% respectively in the three-month period to April.
ECB
50 Monthly Bulletin
July 2010

E C O N O M I C
A N D M O N E T A R Y
D E V E L O P M E N T S
Exchange rate
and balance
of payments
developments
Chart 37 Breakdown of extra-euro area
Chart 38 Main items of the current account
imports into volumes and prices
(three-month-on-three-month percentage changes; monthly data;
(EUR billions; 12-month cumulated ﬂ ows; monthly data;
seasonally adjusted)
working day and seasonally adjusted)
volumes
current transfers balance
prices
income balance
services balance
goods balance
current account balance
10
10
150
150
8
8
100
100
6
6
50
50
4
4
0
0
2
2
0
0
-50
-50
-2
-2
-100
-100
-4
-4
-150
-150
-6
-6
-200
-200
-8
-8
-10
-10
-250
-250
2007 2008 2009
2007
2008
2009
Source: Eurostat.
Source: ECB.
Notes: The latest observations refer to March 2010.
Overall, as a result of import growth being stronger than export growth, the trade surplus of
goods and services narrowed in the three-month period to April compared with previous months.
In 12-month cumulated terms, however, the trade surplus of goods and services increased
(see Chart 38), which – together with the lower deﬁ cits in the income balance and current transfers –
has contributed to a smaller deﬁ cit in the current account. In the year to April, the cumulated current
account deﬁ cit stood at €32.3 billion (around 0.4% of euro area GDP), compared with €153.8 billion
a year earlier.
Looking ahead, available indicators suggest that extra-euro area exports of goods will continue to
increase in the near term. However, as the trade recovery is to some extent supported by temporary
factors – such as ﬁ scal stimuli and the inventory cycle – some loss of momentum may be expected
once the impact of these factors fades. Indeed, the Purchasing Managers’ Index of new export orders
in the euro area manufacturing sector remained well above the expansion/contraction threshold of
50, but has declined somewhat in recent months.
FINANCIAL ACCOUNT
In the three-month period to April 2010, combined direct and portfolio investment recorded average
monthly net outﬂ ows of €4.6 billion, compared with net inﬂ ows of €15.4 billion over the previous
three-month period (see Table 7). This shift was the result of both lower net inﬂ ows in portfolio
investment and higher net outﬂ ows in direct investment, in particular owing to euro area companies
increasing their outstanding loans to foreign afﬁ liates.
The developments in portfolio investment in the three-month period to April 2010 point to some
re-emergence of risk aversion on the part of foreign investors amid renewed ﬁ nancial market
turbulence and increasing concerns over the economic difﬁ culties in some peripheral euro
ECB
Monthly Bulletin
July 2010
51

Chart 39 Main items of the financial account
(EUR billions; net ﬂ ows; three-month moving averages;
(EUR billions; 12-month cumulated net ﬂ ows; monthly data)
monthly data)
equities
equities
money market instruments
money market instruments
bonds and notes
bonds and notes
direct investment
direct investment
combined direct and portfolio investment
combined direct and portfolio investment
120
120
600
600
100
100
80
80
400
400
60
60
200
200
40
40
20
20
0
0
0
0
-20
-20
-200
-200
-40
-40
-60
-60
-400
-400
2007
2008
2009
2007
2008
2009
Source: ECB.
area countries. This resulted in a strong weakening of net investment in euro area equities by
non-residents in the three-month period to April 2010 over the previous three-month period. At the
same time, a marked increase of net purchases of euro area bonds and notes by non-residents was
recorded, partly triggered by the higher volatility in the US Treasury market in April.
Turning to longer-term developments, net inﬂ ows in combined direct and portfolio investment
decreased to €160.8 billion in the 12-month period to April 2010, compared with €232.7 billion
in the same period a year earlier, mainly driven by reduced net inﬂ ows in portfolio investment
(see Table 7). The breakdown of portfolio investment by instrument indicates that this reduction
was primarily the result of a large decrease in net inﬂ ows in debt instruments, which more than
offset the shift from net outﬂ ows to net inﬂ ows in equities (see Chart 39). This is in line with the
trend in the last few quarters of a return of global investors to the equity markets and the gradual
scaling-down of the exceptionally high ﬂ ows in debt instruments in late 2008 and the ﬁ rst months
of 2009 due to factors related to the ﬁ nancial crisis.
ECB
52 Monthly Bulletin
July 2010

A R T I C L E S
LABOUR MARKET ADJUSTMENTS
TO THE RECESSION IN THE EURO AREA
The recent ﬁ nancial crisis and the ensuing recession have taken a heavy toll on euro area labour
markets. Employment losses have been considerable and heavily concentrated in a few sectors.
Despite a large contraction in employment, euro area wages have been slow to react, reﬂ ecting
institutional rigidities. Moreover, there has been considerable cross-country heterogeneity in
labour market reactions to the downturn in activity. Various policy measures have been enacted,
aimed at maintaining employment through the crisis. This article argues that a timely dismantling
of many of these measures would help to accelerate the restructuring process. Without sectoral
reallocation and greater wage ﬂ exibility, the euro area may take many years to generate sufﬁ cient
employment growth to absorb those workers currently displaced.
1 INTRODUCTION
Moreover, the recent recession has seen
considerable cross-country heterogeneity – in
The recent deep recession triggered a swift and terms of employment (see Chart 2), hours and
strong reaction in euro area employment. wage reactions, and in the policies adopted by
Between the second quarter of 2008 (the peak of way of crisis measures.1
euro area employment) and the fourth quarter of
2009 (when the decline in employment appears Charts 1 and 2 show the evolution of euro area
to have bottomed out), euro area employment fell employment growth since 2006, according to
by 2.6%, following a sharp decline in economic national accounts data. After several years of
activity. By the end of 2009 euro area employment
had fallen back to its mid-2006 level, effectively
reversing two years’ worth of job growth. 1 See also the boxes entitled “The composition of the recent
decline in employment in the euro area” in the September 2009
Employment losses have been particularly heavy
issue of the Monthly Bulletin and “Employment developments in
in industry and construction (see Chart 1).
the euro area in 2009” in the Annual Report 2009.
Chart 1 Euro area employment growth
Chart 2 Euro area employment growth and
and sectoral contributions
country contributions
(annual percentage changes and percentage point contributions)
(annual percentage changes and percentage point contributions)
total economy
euro area
agriculture
Germany
industry excluding construction
Spain
construction
France
trade and transport
Italy
finance and business
all other euro area countries
other service activities
2
2
2
2
1
1
1
1
0
0
0
0
-1
-1
-1
-1
-2
-2
-2
-2
-3
-3
-3
-3
2006
2007
2008
2009
2006
2007
2008
2009
Sources: Eurostat and ECB calculations.
Sources: Eurostat and ECB calculations.
ECB
Monthly Bulletin
July 2010
53

robust growth in the mid-2000s, in 2008 euro 2
FEATURES OF THE RECENT RECESSION
area employment growth slowed markedly –
from a brisk 1.5% year on year in the ﬁ rst quarter The recent recession has been the strongest
of 2008 to a 0.2% contraction by the ﬁ nal quarter downturn experienced in the euro area since the
of that year. In the second half of 2009 euro area Second World War. Between the ﬁ rst quarter
employment declined at a rate of around 2.2% of 2008 and the second quarter of 2009, euro
year on year, but the rate of decline appears to area real GDP fell by 5.3%, following a severe
have moderated in the ﬁ rst quarter of 2010.2
ﬁ nancial crisis and substantial corrections to
overheated economies in a number of euro area
A wide variety of factors help to explain the countries. The systemic nature of the ﬁ nancial
considerable degree of heterogeneity seen in euro crisis which preceded the latest downturn
area labour markets during the recent recession. has important ramiﬁ cations for employment
Differences in outcomes may partly reﬂ ect cross-
dynamics in the post-crisis period, since
country differences in sectoral composition and recessions triggered by ﬁ nancial crises typically
thus a higher exposure of some countries to the give rise to longer-lasting macroeconomic effects
large sectoral shocks experienced in the context than those resulting from other (non-systemic)
of the recent ﬁ nancial crisis. Moreover, differences
recessions. These effects include higher
in employment structure – with varying losses in – and a more gradual recovery of –
proportions of workers covered by permanent and
output and employment, as well as longer-
temporary contracts – are also likely to lead to lasting increases in unemployment and higher
differing labour market outcomes. At a less structural unemployment, following typically
aggregate level, ﬁ rms’ ﬁ nancial positions – and deep and prolonged declines in asset prices
their ability to withstand the impact of a marked and sharp increases in government debt.4
fall in output – undoubtedly play an important
role. Similarly, the degree of labour shortage prior
EMPLOYMENT REACTIONS
to the recession may have encouraged greater
labour “hoarding” among ﬁ rms fearing (post-
By the ﬁ rst quarter of 2010 euro area employment
recovery) constraints in some local or highly was around 2.6% lower than at its peak in
specialised labour markets. Furthermore, part of the second quarter of 2008. A simple scatter
the large heterogeneity observed is due to the plot associating contemporaneous changes in
interaction of the various countries’ distinctive employment with changes in output (Chart 3)
institutional features and policies – including the demonstrates the high degree of heterogeneity
willingness of workers’ representatives to accept in the labour market responses of the various
ﬂ exible wage-setting and wage moderation – euro area countries, regardless of the marked
which can help to mitigate the strongest effects of differences in the magnitude of the downturns
the recession on labour market participants.3
experienced. In some countries (e.g. Germany),
there has been relatively little change in
This article proceeds as follows: Section 2 employment, despite large falls in output;
examines euro area labour market dynamics
since the onset of the crisis, focusing on the 2 Eurostat’s ﬁ rst national accounts estimate for the ﬁ rst quarter of
2010 appears to show a stabilisation in euro area employment
sectoral and compositional effects which
levels in that quarter. This article is based on the data available
characterised the recession. Section 3 examines
up to 24 June 2010.
3 In addition, part of the difference observed can be explained by the
the differing degrees of wage and labour cost
varying reactions of each country’s labour force to deteriorating
responsiveness. Section 4 reviews the policy and
employment conditions (“supply effects”); this aspect was
institutional features which have contributed to
explored in the box entitled “Recent labour supply developments”
in the June 2010 issue of the Monthly Bulletin.
shaping the differing adjustments observed. The 4 See, for instance, C. Reinhart and K. Rogoff (2009),
article ends with an assessment of the current
“The Aftermath of Financial Crises”, in American Economic
outlook for euro area labour markets and draws
Review, Vol. 99, No 2 (May), and S. Claessens, A. Kose and
M. Terrones (2008), “What Happens During Recessions,
out policy implications (Section 5).
Crunches, and Busts?”, IMF Working Paper No 08/274.
ECB
54 Monthly Bulletin
July 2010

A R T I C L E S
Chart 3 Changes in output and employment
Chart 4 Elasticity of employment with
Labour market
respect to output; by country
adjustments to
the recession in
(percentage changes; Q1 2008-Q1 2010)
the euro area
x-axis: percentage change in GDP
recent recession
y-axis: percentage change in employment
1990s recession
4
4
euro
area
LU
ES
MT
CY
DE
BE CY
PT
0
0
AT
IE
NL
MT
FR
IT
GR
SK
SK
FI
euro area
GR
PT
-4
-4
SI
SI
FI
FR
IT
-8
-8
NL
Bar truncated;
BE
actual elasticity: 3.1
AT
IE
ES
DE
LU
-12
-12
-12
-8
-4
0
4
0.0
0.4
0.8
1.2
1.6
2.0
2.4
Sources: Eurostat and ECB calculations.
Sources: Eurostat and ECB calculations.
Note: Data for Austria, Luxembourg and the Netherlands
Notes: Elasticities denote percentage reductions in employment
refer to Q1 2008-Q4 2009, while those for Ireland refer to
divided by percentage reductions in GDP. Elasticities are computed
Q1 2008-Q3 2009.
using country-speciﬁ c peaks and troughs, or using the latest data
where a trough has not yet been reached (computations thus differ
from Chart 3).
others (most notably Spain) have suffered countries (brown bars), which occurred in the
disproportionately large falls in employment early 1990s. This shows a clearly higher reaction
compared with their respective output losses.
of employment to GDP contractions in the earlier
episode, except in Spain. Systemic recessions
Between its peak in the second quarter of 2008 following ﬁ nancial crises typically exert deeper
and its trough in the fourth quarter of 2009, euro and longer-lasting labour market reactions than
area employment fell by 2.6% – around half the non-systemic recessions. Thus, for several
size of the peak-to-trough contraction in GDP. countries, the full employment effects of the
These magnitudes suggest a euro area elasticity of
systemic 1990s recessions lasted substantially
employment to changes in output of around 0.5. longer (with employment troughs reached after
That is, for each percentage point fall in GDP, 12 to 15 quarters) than those of the countries
employment has fallen by around ½ percentage experiencing non-systemic recessions (seven to
point since the ﬁ rst quarter of 2008. At the country
eight quarters).6
level, elasticities ranged from 2.2 in Spain to
virtually zero in Germany, as shown in Chart 4.
5 See the box entitled “A comparison of employment developments
in the euro area and the United States” in this issue of the
Monthly Bulletin.
Despite signiﬁ cant job losses across the euro area 6 Financial crises are deﬁ ned following Chapter 3 of the April 2009
during the recession, the employment reactions
IMF World Economic Outlook. See also the box entitled “Labour
markets and ﬁ nancial crises” in “Wage dynamics in Europe: ﬁ nal
of many of the euro area economies have, to
report of the Wage Dynamics Network” (ECB, December 2009),
some extent, been more muted than might have
as well as the article entitled “The latest euro area recession
been expected – either on the basis of comparisons
in a historical context” in the November 2009 issue of the
Monthly Bulletin. The rather lower responsiveness of euro area
with other leading economies 5 or in relation to
employment to the fall in activity during the recent recession is
historical observations. Chart 4 also includes
to a large extent conﬁ rmed by unemployment dynamics. See the
box entitled “Links between output and unemployment in the
(where data permit) elasticity estimates for the
euro area” in the October 2009 issue of the Monthly Bulletin or
last major recession to affect most euro area
Chapter 3 of the April 2010 IMF World Economic Outlook.
ECB
Monthly Bulletin
July 2010
55

CHANGES IN HOURS WORKED
THE SECTORAL DIMENSION TO THE CRISIS
Aside from the notable reductions seen in The sharp slowdown in employment growth
headcount employment, the latest recession has observed in construction since early 2007
also been marked by a substantial reduction in followed several years of rapid employment
total hours worked over and above that generated growth in this sector, particularly from the
by job losses. Chart 5 uses data from the European
middle of the decade (see Chart 7). Industrial
Labour Force Survey (currently available only employment reacted later, but then declined
up until the fourth quarter of 2009), enabling a markedly. So far, employment in industry and
decomposition of changes in total hours worked construction has fallen by 8.5% and 11.9%
into employment and average working hours respectively from pre-crisis peaks.
effected according to employment status.
Chart 8 shows the cumulative impact
While part of the decline in total hours worked of these sectoral declines on aggregate
over the course of the recession reﬂ ects some employment developments in the euro
reduction in individual working time accounts, area and the individual euro area countries
part also reﬂ ects the very extensive use of shorter since the ﬁ rst quarter of 2008. The decline
working hours schemes instituted in a number of in construction employment is particularly
euro area countries in a direct attempt to safeguard
sizeable in those countries in which aggregate
employment (discussed further in Section 4). employment has fallen most, i.e. Ireland and
This has resulted in considerable heterogeneity Spain, in part reﬂ ecting a brisk correction
across countries, as shown in Chart 6.
to earlier overheating in the housing sector.
Chart 5 Growth in euro area total hours
Chart 6 Growth in total hours worked and
worked and contributions by worker type
contributions by worker type; by country
(annual percentage changes and percentage point contributions)
(percentage changes and percentage point contributions;
Q4 2008-Q4 2009)
total hours worked
total hours worked
contribution from full-time employment
contribution from full-time employment
contribution from part-time employment
contribution from part-time employment
contribution from average weekly hours of
contribution from average weekly hours of
full-time workers
full-time workers
contribution from average weekly hours of
contribution from average weekly hours of
part-time workers
part-time workers
3
3
euro
area
IE
2
2
ES
SK
FI
1
1
PT
AT
0
0
GR
IT
-1
-1
FR
SI
-2
-2
NL
DE
CY
-3
-3
BE
MT
-4
-4
2006
2007
2008
2009
-14
-12
-10
-8
-6
-4
-2
0
2
4
Sources: Eurostat and ECB calculations.
Sources: Eurostat and ECB calculations.
Note: Data for France are estimates.
Note: Data for France are estimates.
ECB
56 Monthly Bulletin
July 2010

A R T I C L E S
Chart 7 Sectoral growth rates in euro area
Chart 8 Sectoral contributions to aggregate
Labour market
employment
employment developments; by country
adjustments to
the recession in
(annual percentage changes)
(percentage changes and percentage point contributions;
the euro area
Q1 2008-Q1 2010)
total economy
total economy
agriculture
agriculture
industry excluding construction
industry excluding construction
construction
construction
trade and transport
trade and transport
finance and business
finance and business
other service activities
other service activities
6
6
euro
area
IE
4
4
ES
SI
FI
2
2
PT
SK
0
0
GR
IT
-2
-2
FR
NL
-4
-4
AT
BE
CY
-6
-6
DE
LU
-8
-8
2006
2007
2008
2009
-12
-10
-8
-6
-4
-2
0
2
4
Sources: Eurostat and ECB calculations.
Sources: Eurostat and ECB calculations.
Notes: Data for Cyprus are not seasonally adjusted. Data for Ireland
refer to Q1 2008-Q3 2009, while data for France, Luxembourg,
the Netherlands and Austria refer to Q1 2008-Q4 2009.
In both countries, the construction sector (particularly construction, as well as certain
represented between a third and a half of manufacturing industries), some of the recent
total labour shedding. Sharp employment downsizing may become entrenched, partly
declines are also evident in the broad industrial as a result of a normalisation of earlier
sector and in trade and transport activities, overheating and partly as the recession is likely
accounting for some 15% and 10% respectively
to lead to signiﬁ cant restructuring in some
of total euro area employment losses. In branches of activity. This will inevitably bring
comparison, contributions to total employment about permanent reductions in employment in
developments from the heavily hit ﬁ nancial these sectors, raising the prospect of increased
and business services sector tend to be rather long-term and structural unemployment –
modest, in large part reﬂ ecting their limited particularly if the skills of displaced workers are
share in total employment. The category “other not easily transferable to other sectors.
service activities” – including the public sector
– actually contributed positively, helping to EMPLOYMENT COMPOSITION EFFECTS
stabilise employment developments.
In addition to the substantial sectoral variation
The high sectoral concentration of employment in job losses seen during the recent recession,
losses seen during the recent recession raises there has been considerable inequality in the
important questions regarding the speed with distribution of employment losses across
which displaced workers are likely to be different groups of workers. How different
reabsorbed in the longer term. For some sectors segments of the labour market – in terms of age,
ECB
Monthly Bulletin
July 2010
57

contractual status or skills – are affected by More recently, temporary employment appears to
the recession is, of course, to a large extent have shown signs of an earlier turnaround in
determined by the sectoral composition of comparison with more permanent forms of
employment and the sectoral exposure to the employment across the euro area, although it is
downturn. But the structure of employment itself,
still posting negative annual rates of growth.
in particular the role and coverage of temporary Workers with permanent contracts, beneﬁ ting
employment contracts, is also an important factor
from wide-ranging employment protection
in explaining the varying employment responses legislation, have been substantially less affected.
to the downturn in the euro area countries.
Meanwhile, part-time work has continued
Temporary workers – i.e. those without to grow (see Chart 10). It is, as yet, too
the employment protection afforded by early to assess the extent to which observed
“permanent”, open-ended employment
increases in the proportion of part-time
contracts – have borne a disproportionate workers in total employment during the
share of the employment adjustment recession simply reﬂ
ect ongoing secular
across the euro area. Prior to the recession, trends as opposed to the impact of the crisis.
the share of temporary workers in total Certainly, the recession hit traditionally
employment had been consistently increasing, full-time sectors (such as construction and
reaching around 17% of total euro area industry) particularly hard. Moreover, crisis
employment by the middle of 2007. Indeed, measures – designed to protect jobs by means
the growth in temporary contracts, as well of shorter working hours – may themselves
as other forms of non-permanent working have helped to increase the part-time ratio,
arrangements such as self-employment as a as ostensibly “full-time” employees work
freelancer, contributed substantially to the fewer weekly hours. Recent data from the
rapid employment growth seen in the euro area
before the crisis. But the prevalence of such 7 See, for example, S. Bentolila, P. Cahuc, J. Dolado and
T. Le Barbachon (2010), “Unemployment and temporary jobs
contracts varied considerably across countries,
in the crisis: comparing France and Spain”, FEDEA Working
with temporary contracts applying only to
Paper No 2010-07.
around 5% of workers in Slovakia, but almost
one-third of all employees in Spain. As the
Chart 9 Euro area employment growth by
contract type
effects of the ﬁ nancial market turmoil began
to impact on the wider euro area economy,
(annual percentage changes)
ﬁ rms were able to react swiftly to the increased
total employment
uncertainty as to future demand for their output
permanent contracts
temporary contracts
by rapidly reducing the number of contract
self-employed
renewals for temporary workers.
6
6
4
4
Between late 2007 and early 2009 the share of
temporary workers in total employment fell
2
2
markedly. As Chart 9 shows, temporary
0
0
employment adjusted relatively earlier – and to a
-2
-2
greater extent – than other forms of employment
in the course of the recession. This trend is
-4
-4
particularly apparent in a few countries, most
-6
-6
notably Spain, where temporary workers have
-8
-8
accounted for virtually the entire employment
adjustment (in part driven by developments in the
-10
-10
2006
2007
2008
2009
construction sector, where the number of Sources: Eurostat and ECB calculations.
temporary jobs has halved since the downturn).7
ECB
58 Monthly Bulletin
July 2010

A R T I C L E S
Such workers are potentially a source of economic
Chart 10 Euro area employment growth of
Labour market
selected groups of workers
dynamism, but are likely to miss out on
adjustments to
the recession in
productivity-enhancing training if they cannot gain
(annual percentage changes)
the euro area
access to the jobs which provide such training.
total employment
Research suggests signiﬁ cant long-term adverse
young workers (<25)
unskilled workers 1)
“scarring” effects of initial negative labour market
part-time workers
experiences, including permanently lower
6
6
employment probabilities and large earnings
4
4
losses, which – for a small proportion of young
people at least – may result in entrenched
2
2
discouragement and a permanent detachment from
0
0
the labour force.10
-2
-2
Regarding the unskilled, the downturn
-4
-4
appears to have exacerbated the long-term
-6
-6
structural decline in demand for such workers.
-8
-8
Nevertheless, there is little cross-country
variation in the decline in lower-skilled
-10
-10
2006
2007
2008
2009
employment, other than that which can be
Sources: Eurostat and ECB calculations.
attributed to the overall sectoral concentration
1) Unskilled workers are deﬁ ned as those with a lower secondary
of the downturn; such workers typically tend
school leaving certiﬁ cate or less.
to be heavily concentrated in construction and
industry.
European Labour Force Survey show
a marked increase in the proportion of
part-time employment, particularly for men, 3
THE RESPONSE OF WAGES
since the onset of the recession.8 While female
AND LABOUR COSTS
participation has also increased, job growth has
occurred only in the part-time segment, helping As well as cutting employment, ﬁ rms can
to mitigate the effects of full-time job losses.9
reduce their labour costs in response to an
economic slowdown by lowering wages. The
Two other groups have been hit particularly responsiveness of wages affects the behaviour
hard by the recession: young workers of other labour market variables, and the
(aged under 25) and the unskilled (those economy more generally. Broad-based
holding only basic school-leaving qualiﬁ cations, if evidence on the link between wages and
any). The stark decline in employment employment, derived using several different
opportunities for younger workers is particularly
evident in Spain and Ireland, which together
account for roughly half of the decline in euro area 8 The European Labour Force Survey questions ﬁ rms about
employment of such workers. Since the onset of
the average hours worked by full and part-time employees.
the recession, youth unemployment rates have
It is however possible that staff are reclassiﬁ ed during a severe
downturn, despite the fact that their “standard” contracts remain
almost doubled, to 20% for the euro area as a
unchanged.
whole by April 2010 (though closer to 30% in 9 See the box entitled “Recent labour supply developments” in the
Ireland and Italy, 35% in Slovakia and over 40%
June 2010 issue of the Monthly Bulletin.
10 See, for example, K. Hämäläinen (2003), “Education and
in Spain). Apart from the social and ﬁ nancial costs
unemployment: state dependence in unemployment among
of long periods of inactivity, the strong decline in
young people in the 1990s”, VATT Discussion Paper 312, and
work opportunities for young people raises
S. Burgess, C. Propper, H. Rees and A. Shearer (2003), “The class
of 1981: the effects of early career unemployment on subsequent
important longer-term macroeconomic issues.
unemployment experiences”, Labour Economics, Vol. 10, Issue 3.
ECB
Monthly Bulletin
July 2010
59

methods, was recently explored by the ESCB of employment has been faster and more
Wage Dynamics Network (WDN).11 The box widespread than that of wages.
below draws on results from the WDN survey,
providing microeconomic observations on how 11 For the summary ﬁ ndings and the related references to special
studies and the literature, see “Wage dynamics in Europe:
ﬁ rms have reacted to the crisis. The broad
ﬁ nal report of the Wage Dynamics Network”, December 2009
message of these ﬁ ndings is that the adjustment
(available on the ECB’s website at www.ecb.europa.eu).
Box
NEW SURVEY EVIDENCE ON LABOUR MARKET ADJUSTMENT TO THE RECESSION IN THE EURO AREA
This box looks at features of labour market adjustment during the recession using ﬁ rm-level
information. It brieﬂ y reviews some of the ﬁ ndings of the Eurosystem/ESCB Wage Dynamics
Network,1 in particular new evidence from a survey in which ﬁ rms were asked about their
responses to the contraction in economic activity during the recession. This survey was launched
during the summer of 2009 in ten countries (Belgium, the Czech Republic, Estonia, Spain,
France, Italy, Luxembourg, the Netherlands, Austria and Poland) and covered over 5,500 ﬁ rms,
85% of which are located in the euro area. It therefore updates previous evidence, which was
based on a survey conducted before the crisis.2
The ﬁ rms’ replies were in line with the macro evidence on the intensity of the recession.
In the euro area countries surveyed, only 15% of ﬁ rms did not see a negative impact on their
activity, while in 38% of ﬁ rms the negative impact was strong or exceptionally strong. This
average hides substantial heterogeneity across countries; for example, while 44% of the ﬁ rms in
Belgium felt that they were suffering from a strong or exceptionally strong negative impact, the
corresponding number in the Netherlands was 28% of ﬁ rms. In addition, most ﬁ rms perceived the
recession as resulting in a fall in demand (41% of ﬁ rms declared that they were being strongly or
very strongly affected by a fall in demand), followed by difﬁ culties in being paid by customers
(29%), whereas ﬁ nancial constraints were declared to be relatively less important (19%).
This held across countries and sectors and for ﬁ rms of different sizes.
The most common response of ﬁ rms to these declines in activity has been to reduce costs, while
price reduction appears to be the least common. Indeed, around 73% of ﬁ rms in the sampled euro
area countries responded that reducing costs is a relevant or very relevant adjustment strategy.
When looking in detail at the particular cost-cutting strategies that these ﬁ rms implemented during
the recession (see Table A), they mainly consisted of adjusting labour costs, which in most cases
were contained by reducing the labour input in terms of permanent or temporary employment, or
hours worked per employee. The percentage of ﬁ rms that chose to reduce temporary employment
as the main channel to adjust costs was very high in Belgium, Spain and the Netherlands
(over 40%). Conﬁ rming that wages in the euro area initially responded very little to the crisis,
only a few ﬁ rms reported cuts in base wages as the main adjustment strategy to reduce labour
costs; however, adjustment through ﬂ exible wage components was more common.
1 The WDN is a research network bringing together researchers from 24 EU central banks. It considers the sources and features of wage
and labour cost dynamics that are most relevant for monetary policy, and the relationship between wages, labour costs and prices both
at the ﬁ rm and the macroeconomic level.
2 The survey is a follow-up to the WDN ﬁ rm survey on price and wage setting, an ad hoc survey collecting information from the period before
2008 and covering over 19,000 ﬁ rms in 20 EU countries. A summary of the evidence on wage setting from the original WDN survey is
provided in the article entitled “New survey evidence on wage setting in Europe” in the February 2009 issue of the Monthly Bulletin.
ECB
60 Monthly Bulletin
July 2010

A R T I C L E S
Table A Cost-cutting strategies of euro area
Table B Incidence of wage cuts and freezes
Labour market
firms during the recession
in the euro area during the recession
adjustments to
the recession in
the euro area
Percentage
Percentage of ﬁ rms
Percentage of ﬁ rms
Main strategy
of ﬁ rms
cutting wages
freezing wages
Reduce labour costs
69.6
ﬁ ve years
summer 2009
ﬁ ve years
summer 2009
Adjust the amount of labour
before the
before
did
will
did
will
crisis
the crisis
Reduce number of temporary/other
cut
cut
freeze
freeze
27.5
employees
1.3
2.1
3.3
7.6
37.1
43.1
Reduce number of permanent employees
16.6
Reduce hours worked per employee
15.4
Source: WDN survey.
Note: See notes to Table 1.
Adjust wages
Reduce ﬂ exible wage components
8.6
Reduce base wages
1.5
Source: WDN survey.
Notes: All ﬁ
gures are employment-weighted. The sample
includes Belgium, Spain, France, Italy, the Netherlands and
Austria. The construction sector is not covered in the Spanish,
French and Italian sample and ﬁ nancial intermediation is not
covered in the Spanish and French sample.
The stronger the impact of a crisis, the more likely it is that a ﬁ rm will resort to reducing labour
costs and in particular employment. Similarly, larger ﬁ rms are more likely than smaller ﬁ rms to
lay off temporary workers and less likely to reduce non-labour costs.
The evidence from the WDN survey data collected before the latest recession showed
that workers’ wages were rarely cut during the ﬁ ve-year period preceding the launch of
the survey and that downward wage rigidity was prevalent in most euro area countries.3
When revisiting these facts in the context of the recent ﬁ nancial crisis, the evidence
suggests that downward wage rigidity is still prevalent. On average, approximately 2.1%
of ﬁ rms in the euro area countries sampled in the follow-up survey experienced cuts in
base wages during the period between the beginning of the crisis and the summer of 2009
(see Table B). This compares with an average share of 1.3% for the same sample of ﬁ rms before
the crisis started. The incidence of wage freezes, however, has increased considerably with the
crisis, from only 7.6% during the ﬁ ve years prior to 2008, to 37.1% by summer 2009. Overall,
this implies that downward wage rigidity was still prevalent in the summer of 2009 and that
many ﬁ rms were freezing wages instead of cutting them, even in an environment of economic
downturn associated with near zero inﬂ ation.
Finally, empirical analysis conﬁ rms that institutional factors are important in shaping ﬁ rms’
responses. In particular, the combination of higher-level collective wage bargaining and strong
employment protection legislation reduces the scope to lower wages and increases the adjustment
through hours per worker, rather than through employment.4 The presence of centralised collective
wage agreements also hinders the adjustment of wages, even of their ﬂ exible components, and
induces ﬁ rms to reduce labour costs through hours worked.
3 J. Babecký, P. Du Caju, T. Kosma, M. Lawless, J. Messina and T. Rõõm (2010), “Downward nominal and real wage rigidity: survey
evidence from European ﬁ rms”, ECB Working Paper No 1105.
4 See the publication referred to in footnote 11 of the main text.
ECB
Monthly Bulletin
July 2010
61

The economic downturn has had a discernible, labour hoarding (see Chart 12). Since then
albeit delayed, downward impact on euro area unit labour cost growth has decreased rapidly,
wage pressures. Chart 11 shows four different turning negative in the ﬁ rst quarter of 2010 as
indicators of wage growth: compensation per productivity grew rapidly.
employee, hourly labour costs, compensation per
hour and negotiated wages.12 Following the onset The responsiveness of wages to the economic
of the recession, all these measures initially downturn has varied substantially across
continued to rise. This reﬂ ected contractual wage euro area countries, reﬂ ecting their exposure
agreements in the euro area (their average length, to the recession and the impact of different
as identiﬁ ed in the WDN survey, is about one and wage-setting institutions. Given that different
a half years), made in 2007-08 – a time of countries had very different wage patterns
increasing labour market tightness and high before the recession, Chart 13 shows the
inﬂ ation rates. By 2009 these trends had reversed annual average growth in actual compensation
markedly, as the environment of weak activity, per employee over the crisis (from the second
rising unemployment and low inﬂ ation led to quarter of 2008 to the ﬁ rst quarter of 2010),
lower outcomes in wage negotiations. By late 2009
the annual average growth rate for the
most labour cost growth measures had slowed to pre-recession period (from the ﬁ rst quarter
below their average growth rates since the of 1999 to the ﬁ rst quarter of 2008), and the
beginning of Monetary Union.
difference between the two series.13
Reﬂ ecting the trends in GDP, employment 12 See the “Prices and costs” section of this issue of the Monthly
and wages, unit labour cost growth rose for a
Bulletin for an explanation of these indicators.
considerable time, peaking at 5.9% in annual 13 Wages in this instance are deﬁ ned as compensation per
employee. Another measure of wages – hourly labour costs – has
terms in the ﬁ rst quarter of 2009, as labour
evolved somewhat differently during the crisis owing to trends
productivity fell sharply as a consequence of
in hours worked.
Chart 11 Euro area wage indicators
Chart 12 Euro area labour cost indicators
(annual percentage changes)
(annual percentage changes)
compensation per employee
compensation per employee
hourly labour costs
productivity
compensation per hour
unit labour costs
negotiated wages
5
5
6
6
4
4
4
4
3
3
2
2
2
2
0
0
1
1
-2
-2
0
0
-4
-4
1999
2001
2003
2005
2007
2009
1999
2001
2003
2005
2007
2009
Sources: Eurostat and ECB calculations.
Sources: Eurostat and ECB calculations.
Notes: Productivity is given by GDP divided by total
employment. Unit labour costs are compensation per employee
divided by productivity.
ECB
62 Monthly Bulletin
July 2010

A R T I C L E S
Chart 13 Average growth in compensation
Chart 14 Euro area growth in compensation
Labour market
per employee prior to and since the start
per employee and sectoral contributions
adjustments to
of the recession; by country
the recession in
(annual percentage changes; percentage points)
(annual percentage changes and percentage point contributions)
the euro area
average; Q2 2008-Q1 2010
total economy
average; Q1 1999-Q1 2008
agriculture
difference
industry excluding construction
construction
trade and transport
finance and business
other service activities
euro
4
4
area
IE
SI
SK
3
3
GR
IT
FI
2
2
NL
BE
LU
FR
1
1
DE
AT
ES
0
0
-8
-6
-4
-2
0
2
4
6
8
10
2006
2007
2008
2009
Sources: Eurostat and ECB calculations.
Sources: Eurostat and ECB calculations.
Notes: Cyprus, Malta and Portugal are excluded owing to data
Note: Sectors are weighted using compensation weights.
limitations. Data for Greece are from Q1 2000. Data for Ireland
refer to the period up to Q3 2009, while those for Luxembourg,
the Netherlands and Austria refer to the period up to Q4 2009.
Since the onset of the recession, euro area during the recession and relatively widespread
compensation per employee has grown at around wage indexation, the burden of Spanish labour
1.6% on average in year-on-year terms, 0.8 market adjustment has fallen more on
percentage point below its pre-crisis average. employment.
This slowing is widespread, with growth in
compensation per employee moderating in almost
Turning to the sectoral breakdown of euro
all euro area countries. The most notable area compensation per employee, Chart 14
decelerations tend to be in the smaller euro area shows that three sectors have accounted for
countries.14 This may reﬂ ect relatively ﬂ exible the majority of the slowdown since the peak
wage-setting institutions in these countries, and a observed in the third quarter of 2008.15 Industry,
greater willingness of employers and employees trade and transport, and other service activities
to allow wage growth to slow in order to limit the have each contributed around 0.6 percentage
loss of employment, in view of their relatively point to the slowdown. Indeed, wages in
large employment and GDP losses during the industry barely grew in 2009. This partly
crisis. Relatively rigid wages in Spain – in reﬂ ects the impact of reduced hours worked per
comparison with the very strong employment employee in this sector, consequently lowering
reaction – partly reﬂ ect the institutional structure the average take-home pay per employee.
of wage-bargaining agreements in that country.
Sectoral bargaining is dominant and is coupled 14 Pre-crisis wage growth in Slovenia and Slovakia should
with regional-level negotiations, meaning that it
be interpreted with caution, as it could partially reﬂ ect
is relatively difﬁ cult for wages to adjust to ﬁ rm-
convergence.
15 The sectoral breakdown of compensation per employee is
level productivity. Therefore, despite low inﬂ ation
currently only available up to the fourth quarter of 2009.
ECB
Monthly Bulletin
July 2010
63

Thus, substantially more adjustment seems
Chart 15 Unit labour costs; by country
to be necessary in several euro area countries
before they can beneﬁ t from strong wage
(index: 2000 = 100)
competitiveness, which will facilitate balanced
euro area
France
and sustainable employment and output growth.
Belgium
Italy
Germany
Netherlands
Ireland
Austria
Greece
Portugal
Spain
Finland
4
THE ROLE OF LABOUR MARKET POLICIES
140
140
AND INSTITUTIONS
135
135
Governments across the euro area have
130
130
implemented a number of crisis measures to
125
125
counter the worst effects of the recession. Almost
120
120
all countries have adopted a range of policies
designed to reduce working time, lower labour
115
115
taxes and ease labour market transitions for
110
110
job-seekers. In addition, around half have
105
105
increased beneﬁ
ts and assistance for the
100
100
unemployed. Many of the crisis measures
introduced, along with strict employment
95
95
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
protection legislation in many countries, may
Source: Eurostat.
have contributed in the short run to cushioning
Notes: Quarterly data up to Q1 2010 (Q3 2009 for Ireland,
the impact of the crisis. However, as several
Q4 2009 for the Netherlands and Austria). The estimates
for Portugal are based on annual data. Unit labour cost
of the measures are having undesirable effects
developments for Greece and Portugal may differ from the
calculations by the respective NCBs. The Greek pattern of unit
on longer-run employment prospects, a timely
labour costs reﬂ ects substantial volatility in quarterly data on
employees’ compensation.
dismantling of many of them would help to
accelerate the restructuring process.
In the latest quarter, over half of the annual The main thrust of the temporary working-
growth in total compensation per employee time reduction measures has been to facilitate
was contributed by “other service activities”, the downward adjustment of hours, as a partial
reﬂ ecting the more resilient nature of public alternative to that of employment (see Charts 5
sector wages. In construction, the relatively and 6). Ofﬁ cial estimates of the impact of the
modest slowdown in compensation per measures show that there have been sizeable
employee – despite a heavy fall in output – effects in Germany (the “Kurzarbeit” scheme)
should be seen against the backdrop of heavy and Italy (the “Cassa Integrazione Guadagni”
employment losses in that sector.
scheme), where such schemes at their peak
applied to around 1.3% and 3% of full-time
While the previous analysis focused on the equivalent workers respectively. Indeed, the bulk
moderation of wage growth during the recession,
of the decline in total hours worked in Germany
the outlook will also depend on how countries is attributable to private sector reductions in
seek to maintain (or restore) competitiveness. average working weeks, rather than reductions in
Unit labour costs rose relatively quickly in headcount employment (see Chart 6).
several countries in the decade preceding the
crisis, in particular in Ireland, Greece, Spain, Many of the short-time working schemes across
Italy and Portugal (see Chart 15). Of these the euro area, initially implemented on a short-
countries, only Ireland and – to a lesser extent –
term basis, have already been extended or are
Italy have seen sustained improvements in due to expire in 2010. These programmes have
their competitiveness over the last two years. helped to avoid excessive labour shedding
ECB
64 Monthly Bulletin
July 2010

A R T I C L E S
and to maintain human capital in the short recent years has been the degree of employment
Labour market
run. However, as the recovery takes hold, and protection legislation. Reforms to moderate
adjustments to
the recession in
since economies need to restructure, necessary employment protection legislation ahead of the
the euro area
adjustments could be hampered if employment crisis and to encourage temporary employment
is frozen in certain sectors. The measures also contracts were factors behind the robust
generate a major ﬁ scal burden without creating employment growth that occurred in the years
incentives for investment to foster recovery.16
prior to the crisis. Employment protection
legislation varies substantially across European
Reductions in tax on labour have generally been countries and across types of contract (temporary
applied to social security contributions. To the or permanent). Some countries have relatively
extent that such measures help to reduce the high levels of protection against the individual
burden on ﬁ rms of employing labour, they are and collective dismissal of permanent workers,
likely to have aided employment developments. which have at least temporarily contributed to
The tax wedge in most euro area countries labour hoarding and mitigated the employment
is high by international standards. Lowering reaction. By contrast, low ﬁ ring restrictions
this wedge could help to tackle weaknesses in applicable to temporary workers have permitted
earlier reforms, but such efforts add to the ﬁ scal sizeable reductions in the number of these
consolidation requirements of certain countries. workers. Such labour market dualism therefore
Therefore, whether they can be pursued further shifts the adjustment burden onto the latter group.
may depend on ﬁ scal tightening in other areas.
Over the longer term, employment protection
legislation may even curtail net job creation, as
Many countries have implemented measures to ﬁ rms become reluctant to hire in the face of high
help the unemployed in their job search (active adjustment costs.
labour market policies). Most governments have
launched or extended training programmes for
the unemployed to help restructure their 5 CONCLUSION
economies, and many have taken steps to
improve the ﬂ ow of information in the labour This article has examined the evolution of euro
market and thereby enhance the job-ﬁ nding area labour markets during the recent recession.
prospects of the unemployed. Maintaining or Several key ﬁ
ndings have emerged. The
extending such measures could help the jobless reduction in euro area employment has been
to ﬁ nd jobs at a time of ongoing sectoral sizeable, following the deep fall in activity on
reallocation, to the extent that budgetary the back of a large ﬁ nancial crisis. However, it
resources allow. In addition, job subsidies to has been somewhat less severe than might have
private employers have been introduced or been expected, at least in relation to historical
increased in many countries. The aims of such patterns. Furthermore, there is a high degree of
subsidies should be to limit displacement effects heterogeneity in labour market responses across
and to ensure high levels of job take-up.17
the various euro area countries, in large part
attributable to developments in construction and
Many governments have extended

manufacturing. Several groups of workers have
unemployment beneﬁ
ts (for instance, by been disproportionately affected by the crisis:
broadening eligibility criteria) to mitigate the temporary workers, the young and the unskilled,
social impact of the crisis. However, these many of whom have been displaced from
measures reduce job-search incentives, as well the above-mentioned sectors. Wages reacted
as adding to the ﬁ scal burdens of euro area
countries.
16 See also the box entitled “Labour market adjustments during the
current contraction of economic activity” in the June 2009 issue
of the Monthly Bulletin.
One of the most important institutional factors 17 See OECD (2010), “Labour markets and the crisis”, Economics
determining labour market dynamics over
Department Working Paper No 756.
ECB
Monthly Bulletin
July 2010
65

only slowly and to a lesser extent, reﬂ ecting
institutional rigidities in some countries,
and this may have contributed to the drop in
employment.
Looking ahead, employment can be expected to
continue to fall in 2010, albeit at a slower rate
than has been seen so far. With considerable
room for an expansion in hours worked, in
the longer term, there is some risk that job
creation will be insufﬁ cient to bring down
unemployment for a signiﬁ cant period of time if
wages do not moderate sufﬁ ciently to stimulate
labour demand. Questions remain as to the
transferability of the sector-speciﬁ c skills of
those newly laid off from construction and some
industrial branches, which may now need to be
permanently downsized.
Policy reforms should now be geared towards
facilitating restructuring and generating
sufﬁ cient employment growth to absorb those
workers currently displaced. Efforts to reduce
the degree of labour market dualism in many
countries should concentrate on increasing
labour market mobility and ﬂ exibility, rather
than seeking to extend employment protection
to temporary workers. In the recovery phase,
further reforms aimed at extending ﬂ exible
contracts are likely to encourage employers
to hire, in an environment characterised
by a high degree of economic uncertainty.
Further measures enhancing training options
for displaced workers and designed to improve
the efﬁ ciency of job searching will also be
required, as well as reforms of tax and beneﬁ t
systems to reinforce ﬁ nancial incentives to
work. Employment growth will also depend on
a restoration of competitiveness – at ﬁ rm,
sectoral and national level. This will require
further reforms of product markets and
wage-setting institutions, so as to ensure that
local labour market conditions are adequately
reﬂ ected in wage bargaining.
ECB
66 Monthly Bulletin
July 2010

THE EFFECTIVENESS OF EURO AREA
FISCAL POLICIES
A R T I C L E S
In the aftermath of the 2008-09 ﬁ nancial and economic crisis, signiﬁ cant ﬁ scal stimulus packages
The effectiveness
were put in place in the euro area. Although reliance on automatic ﬁ scal stabilisers has been
of euro area
fiscal policies
preferred to ﬁ scal activism in recent decades, the ﬁ nancial crisis created adverse conditions in
which timely, targeted and temporary stimulus programmes were likely to be more effective in
supporting output than in normal circumstances. At the same time, their effectiveness in securing
a self-sustaining recovery crucially depends on there being a credible ﬁ scal exit and consolidation
strategy in place that supports conﬁ dence in the longer-term sustainability of public ﬁ nances.
This article summarises the theoretical and empirical evidence on the effectiveness of ﬁ scal policies,
focusing on the euro area. In line with the evidence on ﬁ scal multipliers, the analysis suggests that
temporary ﬁ scal stimulus programmes within the framework of the European Economic Recovery
Plan (EERP) have, to some extent, been supportive for output growth and employment in the euro
area. However, the stimulus packages have also contributed to a further pronounced and persistent
deterioration of ﬁ scal balances. Some euro area countries have been slow in deciding on and
implementing ﬁ scal exit and consolidation strategies, giving rise to increased risks to ﬁ nancial
stability. An illustrative analysis of multi-year ﬁ scal consolidation programmes suggests that the
long-term economic gains of restoring sound ﬁ scal positions in the euro area far outweigh the
short-run costs.
1 INTRODUCTION
of public ﬁ
nances. As a result, counter-
cyclical ﬁ scal policy aimed at stabilising the
Following the global ﬁ nancial and economic macroeconomy has been largely discredited
crisis of 2008-09, governments around the globe since the 1970s.
implemented expansionary ﬁ scal policies with
the aim of stimulating demand. For the euro area
The purpose of this article is to discuss the
countries, the ﬁ scal stimulus packages amount effectiveness of euro area ﬁ scal policies
to roughly 2% of GDP over the two-year with a speciﬁ c focus on the 2008-09 crisis.
period 2009-10 (not counting off-balance-sheet The article builds on existing empirical research
measures and the economic support provided by and model-based analysis. Apart from assessing
automatic ﬁ
scal stabilisers). The common the efﬁ cacy of ﬁ
scal stimulus programmes,
framework for these national counter-cyclical the article also illustrates the long-run beneﬁ ts
ﬁ scal policies was provided by the EERP, and short-run costs of ﬁ scal consolidation
which the European Commission launched on programmes. Government deﬁ cit ratios were
26 November 2008 and the European Council already in excess of the 3% of GDP reference
approved on 11-12 December 2008.1
value in 2009 in the vast majority of euro area
countries. Government debt-to-GDP ratios were
Based on past experience, however, the also rising substantially, approaching or going
effectiveness of counter-cyclical (discretionary)
beyond 100% in several countries. This has
ﬁ
scal expansions is usually undermined called into question the longer-term sustainability
because of delays in implementing ﬁ scal of public ﬁ nances. Ambitious ﬁ scal consolidation
measures, the difﬁ culty of targeting these at the efforts must therefore be an integral part of the
most affected households and ﬁ rms and, more exit strategy to bring public ﬁ nances in line with
generally, the uncertainty about the economy’s the provisions of the Stability and Growth Pact.
response to temporary expenditure programmes
or tax reductions. Another problem relates to 1 See European Commission, “A European Economic Recovery
difﬁ
culties in reversing initially temporary
Plan”, COM(2008)800, 26 November 2008. A brief discussion
of the EERP is provided in A. van Riet (ed.), “Euro area ﬁ scal
ﬁ scal expansions as this may lead to a loss of
policies and the crisis”, Occasional Paper Series, No 109, ECB,
conﬁ dence in the longer-term sustainability
April 2010.
ECB
Monthly Bulletin
July 2010
67

This article considers ﬁ scal policy in the euro of a ﬁ nancial crisis followed by a recession. The
area as a whole, but it should be emphasised discussion also stresses the crucial importance
that the main issue on the ﬁ scal side has been of maintaining conﬁ dence in longer-term ﬁ scal
the total neglect by some countries of the fact sustainability when designing ﬁ scal stimulus
that they have had no room for ﬁ scal manoeuvre programmes.3
at all.2 Countries that delay ﬁ scal consolidation
or do not recognise the severity of their ﬁ scal COUNTER-CYCLICAL FISCAL POLICY
situation contribute to the ﬁ scal problems
in the euro area as a whole. This can raise The idea that public spending (while keeping
concerns regarding ﬁ nancial stability. From tax rates constant) is the right tool for
this perspective, in a single currency area, ﬁ scal addressing economic downturns is based on
policies need to take fully into account speciﬁ c the view that, if private demand is too low,
national weaknesses, within the requirements of then government spending crowds in private
the Stability and Growth Pact.
spending. This Keynesian view has been
challenged by the neoclassical view, namely
The article is organised as follows. Section 2 that government spending and taxation are
provides an overview of the theoretical powerless to affect the aggregate levels of
underpinnings of ﬁ scal policy effectiveness, spending and employment in the economy.
with a speciﬁ c focus on the recent crisis Consequently, such policies would only redirect
conditions. In this context, it discusses the role resources from the private sector to the public
of automatic stabilisation and discretionary ﬁ scal sector, resulting in full crowding-out. In the
policy, the notion of Ricardian equivalence, the 2008-09 crisis, the Keynesian view seems to
issue of liquidity and credit constraints, and the have regained a stronghold.
crucial importance of maintaining conﬁ dence
in longer-term ﬁ scal sustainability. Section 3 Therefore, one must consider the different levels
reviews the empirical evidence regarding the at which crowding-out may occur. First, the
effects of ﬁ scal policies on economic growth government will engage in productive activities
and the evidence on ﬁ scal multipliers. Section 4 that would otherwise be provided by the private
assesses the macroeconomic effects of ﬁ scal sector, so that public spending would simply
stimulus programmes within the framework of supplant private investment. Second, government
the EERP, and also discusses, more generally, spending may create upward pressure on real
the size of ﬁ scal multipliers within structural interest rates, especially in highly indebted
models used by a number of policy-making countries. This reduces private expenditure that is
institutions. Against the background of post-
interest rate sensitive (e.g. spending on consumer
crisis ﬁ scal imbalances in the euro area, Section durables, business ﬁ xed investment and residential
5 discusses the costs and beneﬁ ts of multi-
construction). Third, there are signiﬁ cant negative
year ﬁ scal consolidation programmes. Finally, wealth effects associated with debt-ﬁ nanced
Section 6 concludes.
public spending. This type of crowding-out effect
is often associated with the Ricardian equivalence
hypothesis, which states that households save the
2
FISCAL POLICY EFFECTIVENESS: THEORETICAL
proceeds from a debt-ﬁ nanced ﬁ scal stimulus
CONSIDERATIONS
in anticipation of the future tax increase needed
This section discusses the theoretical 2 For an assessment of the diversity of the ﬁ scal positions of euro
underpinnings of counter-cyclical ﬁ scal policy
area countries at the onset of the ﬁ nancial and economic crisis,
see, for example, A. van Riet (ed.), “Euro area ﬁ scal policies and
and automatic ﬁ scal stabilisation. In this context,
the crisis”, Occasional Paper Series, No 109, ECB, April 2010.
a comparison is made between the effectiveness 3 See also W. Köhler-Töglhofer and L. Reiss, “The effectiveness
of ﬁ scal stimulus packages in times of crisis”, Monetary Policy
of ﬁ
scal policies under normal cyclical
and the Economy, Q1/09, Oesterreichische Nationalbank,
conditions and under the speciﬁ c circumstances
2009, pp. 78-99.
ECB
68 Monthly Bulletin
July 2010

A R T I C L E S
to repay the additional government debt. Under important. Second, when the economy is
The effectiveness
rather restrictive assumptions (see Box 1), such experiencing a severe downturn, and inﬂ ation
of euro area
fiscal policies
Ricardian behaviour implies that consumers’ is already very low, the central bank may not
net wealth becomes invariant to an increase in want to counteract the inﬂ ationary effects of
debt-ﬁ nanced government expenditure.
the temporary ﬁ scal stimulus. Hence, ceteris
paribus, less upward pressure on the real
In a severe recession associated with a global interest rate and a lower crowding-out effect
ﬁ
nancial crisis, like the one experienced is likely. Third, in the presence of a large
recently, the crowding-out effect may negative output gap, the likelihood of crowding
potentially be weaker for several reasons. out private expenditure is probably smaller.
First, the share of agents with liquidity and/or Finally, in the face of a global recession, a
credit constraints may increase in the course common (coordinated) counter-cyclical ﬁ scal
of a recession, in particular when banks face response can internalise cross-border leakages
balance sheet problems and reduce credit and enhance its efﬁ cacy for all participating
supply. This makes Ricardian behaviour less countries.
Box 1
RICARDIAN EQUIVALENCE
In economic theory, Ricardian equivalence arises when forward-looking consumers save the
proceeds from a debt-ﬁ nanced ﬁ scal stimulus in anticipation of the future tax increase that will
be needed to repay the extra government debt. Consumers’ net wealth is thus invariant in the
event of an increase in debt-ﬁ nanced government expenditure, and budget deﬁ cits would have
no short-term real economic effects. This theory contrasts with the conventional Keynesian view
that higher budget deﬁ cits would stimulate demand in the short run.1
The theoretical possibility of Ricardian equivalence is based on a number of strict assumptions.
These assumptions include households that exist inﬁ nitely (or intergenerational altruism within
households that have a ﬁ nite life), price ﬂ exibility, lump-sum taxes, efﬁ cient capital markets and
an absence of credit constraints.
On the one hand, in the case of a severe recession, Ricardian equivalence may be less likely
to arise than in normal times. In particular, the share of households with liquidity or credit
constraints may increase, making any effect of Ricardian behaviour less important. On the other
hand, it has also been argued that if ﬁ scal stimulus packages are perceived as permanent rather
than temporary and lead to expectations of much higher government debt, the importance of
Ricardian behaviour may actually rise. In addition, the possible negative reactions of ﬁ nancial
markets to sizeable increases in government debt may undermine the expected positive economic
effects of a ﬁ scal stimulus. Indeed, an increased risk of defaults on government debt and the
potential rise in interest rates will dampen or even offset the economic stimulus.2
1 See D. Ricardo, “On the principles of political economy and taxation”, in P. Sraffa (ed.), The works and correspondence of David
Ricardo, Volume I, Cambridge University Press, 1951; and R. Barro, “Are government bonds net wealth?”, Journal of Political
Economy, 82(6), 1976, pp. 1095-117.
2 See, for instance, J. Seater, “Ricardian equivalence”, Journal of Economic Literature, 31, 1993, pp. 142-190.
ECB
Monthly Bulletin
July 2010
69

Regarding the actual implementation of ﬁ scal constraints. Moreover, the temporary nature of
policy, the above theoretical points suggest that, a ﬁ scal stimulus can be signalled by a credible
in order for a ﬁ scal stimulus to be effective, it ﬁ scal exit strategy conditional upon the recovery
needs to be timely, targeted and temporary.4 gaining hold.
But timeliness can be hampered by lags in
decision-making and implementation. In fact, AUTOMATIC STABILISERS
when the ﬁ scal impulse reaches the economy,
the measures taken are often no longer needed The advantages of automatic stabilisation
and could actually turn out to be pro-cyclical. are well known. First, they are less subject to
The effectiveness of ﬁ scal policies can also be time lags in decision-making compared with
reduced by calls for ﬁ scal activism from different
discretionary measures. Moreover, they are not
groups in society, which can increase the subject to political decision-making processes
difﬁ culties of agreeing on speciﬁ c discretionary and their economic impact adjusts automatically
measures. Therefore, targeting ﬁ scal policies to the cycle. Of course, the better the ﬁ scal
at speciﬁ c beneﬁ ciaries may also be a difﬁ cult position, the more scope there will be for the
task. In addition, spending increases or tax cuts automatic stabilisers to operate freely and fully.
initially intended to be temporary may, in the Such reasoning underpins the framework of the
end, prove difﬁ cult for the government to reverse,
Stability and Growth Pact, according to which
which will then worsen the ﬁ scal position and countries must achieve a country-speciﬁ c “close
may imply higher domestic interest rates through to balance or surplus” medium-term budgetary
increases in risk premia. Truly temporary objective. Accordingly, automatic stabilisers
(or short-lived) ﬁ scal expansions reduce the should be the ﬁ rst line of defence in an economic
negative wealth effect of government spending, downturn, provided they do not undermine ﬁ scal
and hence the crowding-out effect is likely to stability.
be smaller. Some of the research evidence also
shows that ﬁ scal expansion can be more effective
FISCAL CONSOLIDATION
when households expect it to be reversed through
future government spending cuts.5
Related to the above considerations, favourable
expectation effects could also, in theory, more
In addition, ﬁ scal stimulus measures for certain than offset the contractionary impact of ﬁ scal
sectors of the economy (e.g. the car scrapping consolidation on growth (the so-called non-
premium put in place by several euro area Keynesian ﬁ scal effects). The expansionary ﬁ scal
countries) or for the labour market (for instance, contraction hypothesis posits that consumers
subsidising shorter working hours) are likely to anticipate beneﬁ ts from ﬁ scal consolidation
have distortionary effects on competition and on for their permanent income and consequently
structural adjustments. This is another reason raise private consumption straight away.
why such stimuli should be of a temporary
nature.6
Consequently, although there are many 4 See, for example, the box in the June 2008 issue of the
theoretical reasons to argue that timely,
Monthly Bulletin, “Discretionary ﬁ scal policies, automatic
targeted and temporary ﬁ scal stimuli can be
stabilisation and economic uncertainty”, and A. van Riet (ed.),
“Euro area ﬁ scal policies and the crisis”, Occasional Paper
effective, there are many practical issues that
Series, No 109, ECB, April 2010 for further discussions and
can jeopardise its efﬁ cacy. At the same time,
possible extensions of the three conditions for ﬁ scal stimulus
these practical constraints may be less important
effectiveness.
5 See G. Corsetti, A. Meier and G. Müller, “Fiscal stimulus with
in a ﬁ nancial crisis, when the expectation of
spending reversals”, CEPR Discussion Paper No 7302, 2009.
a prolonged recession offers less risk of a 6 See the box in the October 2009 issue of the Monthly Bulletin,
“The effects of vehicle scrapping schemes across euro area
pro-cyclical response and it should be easier
countries” and the article “Labour market adjustments to the
to target agents facing liquidity and/or credit
recession in the euro area” in this issue of the Monthly Bulletin.
ECB
70 Monthly Bulletin
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A R T I C L E S
In other words, the frequently assumed negative important factor, notably public investment in
The effectiveness
Keynesian reaction of private consumption education, which increases the level of human
of euro area
fiscal policies
to ﬁ scal consolidation could be reversed. For capital and is one of the main sources of long-
instance, a signiﬁ cant and sustained reduction run economic growth. Therefore, productive
of government expenditure may lead consumers expenditure has a positive effect on the growth
to assume that a permanent tax reduction will potential of an economy by means of increasing
also take place in the near future, inducing a the marginal productivity of capital and/or
positive wealth effect and increasing private labour or total factor productivity. In this regard,
consumption.7 In addition and apart from the “core” government spending may be as
positive wealth effect, expansionary effects important to longer-term output growth as
following ﬁ scal consolidation can also relate to private capital and labour. It can raise the human
other factors such as supply-side or structural and physical capital stock and technical progress
reforms, monetary policy adjustments or in the economy either directly or indirectly by
exchange rate depreciations accompanying the creating synergies for private activities.11
ﬁ scal consolidation.
In addition, efﬁ cient and sustainable ﬁ scal
Furthermore, the credible announcement and policies are a prerequisite for long-term
implementation of a ﬁ scal consolidation strategy growth. They entail moderate and predictable
may diminish the risk premium associated with growth-enhancing government spending
government debt issuance, which in turn reduces which stimulates private investment and
real interest rates and makes the crowding-in innovation, while minimising potential adverse
of private spending more likely. This applies in repercussions from necessary taxation through
particular to countries with very high budget the minimisation of disincentives to save,
deﬁ
cits and high government indebtedness, invest, work and innovate. Accordingly, size,
which, in the context of a crisis, are most vulnerable
composition and volatility of budgetary items
to rapid changes in market sentiment. However, may impinge on economic growth. In particular,
if the reduction in government expenditure higher levels of government spending to GDP
is small and temporary, or lacks credibility, may endanger ﬁ
scal sustainability and/or
private spending may not respond positively to increase the tax burden, which is harmful to
the ﬁ scal cutback.8 In addition, literature on the potential growth.
subject also refers to the long-run beneﬁ ts of
ﬁ scal consolidation on output arising from lower
long-term interest rates following the reduction of
government borrowing requirements.
7 See O. Blanchard, “Comment on Giavazzi and Pagano”, in
O. Blanchard and S. Fischer (eds.), NBER Macroeconomics
Annual, Vol. 5, MIT Press, 1990, pp. 111-116.
FISCAL POLICIES AND LONG-TERM ECONOMIC
8 See F. Giavazzi and M. Pagano, “Can severe ﬁ scal contractions
GROWTH
be expansionary? Tales of two small European countries”, in
O. Blanchard and S. Fischer (eds.), NBER Macroeconomics
Annual 1990, MIT Press, 1990, pp. 75-111. For empirical
The traditional neoclassical growth model does
evidence see, for instance, A. Afonso, “Expansionary ﬁ scal
not allow for ﬁ scal policies to affect the long-
consolidations in Europe: new evidence”, Applied Economics
Letters, 17(2), 2010, pp. 105-109.
term growth rate of the economy. However, 9 See D. Aschauer, “Is public expenditure productive?” Journal
several extensions of the neoclassical growth
of Monetary Economics, 23, 1989, pp. 177-200; and R. Barro
and X. Sala i Martin, “Technological diffusion, convergence and
theory have considered public expenditure and
growth”, Journal of Economic Growth, 2, 1995, pp. 1-27.
taxation as playing a crucial role in determining 10 R. Lucas, “On the mechanism of economic development”,
long-term economic growth.9 Moreover,
Journal of Monetary Economics, 22, 1998, pp. 3-42; R. Barro,
“Economic growth in a cross section of countries”, Quarterly
government expenditure in public infrastructure
Journal of Economics, 106(2), 1991, pp. 407-430; and P. Romer,
and in research and development are also
“Endogenous technological change”, Journal of Political
Economy, 98(5), 1990, pp. 71-102.
important factors for growth.10 The composition 11 See “Structural policies in times of crisis” in the December 2008
of public spending has also been identiﬁ ed as an
issue of the Monthly Bulletin.
ECB
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July 2010
71

3
FISCAL POLICY EFFECTIVENESS: EMPIRICAL
However, there is widespread uncertainty in
EVIDENCE
empirical studies about the private sector’s
response to temporary ﬁ scal actions. Fiscal
This section discusses the empirical evidence spending and tax (cut) multipliers based on
from two strands of literature. The ﬁ rst is related VAR models range from negative numbers to
to the long-term growth effects of ﬁ scal policy. positive numbers well above one.17
The second concerns literature which studies
the size of ﬁ scal multipliers, i.e. the impact of One of the key difﬁ culties in the empirical
discretionary ﬁ scal policy measures on output, literature is related to the identiﬁ cation of the
considering different ﬁ scal instruments.
so-called ﬁ
scal shocks, i.e. the autonomous
component of ﬁ
scal measures. Large ﬁ scal
LONG-TERM GROWTH EFFECTS OF FISCAL POLICY
stimulus programmes are typically implemented
in times of economic distress. Hence, spending
The empirical ﬁ ndings regarding the effects of increases observed in the economic data typically
ﬁ scal policies on economic growth, covering reﬂ ect changes in the state of the economy, rather
OECD countries, are predominantly based than autonomous changes in ﬁ scal policy
on panel and vector autoregressive (VAR) undertaken by the governments. Another problem
analysis. The results of such studies can be is that ﬁ scal measures are typically preceded by
summarised as follows: negative effects arise budgetary or even legislative processes. As a
from distortionary taxation and disproportionate consequence, the ﬁ
scal measures are often
levels of government consumption and public anticipated by the private sector. In this case, the
wages, whereas positive effects are associated difﬁ culty of assessing the effectiveness of ﬁ scal
with government investment and, notably, stimulus measures by means of VAR models is
education expenditure.12 For example, available further exacerbated.18 Moreover, as also noted
empirical evidence on the macroeconomic rate in Section 2, the speciﬁ city of the policy
of return on public investment suggests that environment in which counter-cyclical ﬁ scal
public investment is expansionary and has
crowding-in effects in most OECD countries.13 12 See a summary in A. Afonso and J. González Alegre, “Economic
At the same time, other empirical studies ﬁ nd
growth and budgetary components: a panel assessment for the
EU”, Working Paper Series, No 848, ECB, 2008.
a negative link between government size and 13 See A. Afonso and M. St. Aubyn, “Macroeconomic rates of return
growth.14 For instance, both government size
of public and private investment: crowding-in and crowding-out
and ﬁ scal volatility tend to hamper growth in
effects”, Manchester School, 77(S1), 2009, pp. 21-39.
14 See European Commission, “Public ﬁ nances in EMU 2008”,
OECD countries.15
European Economy, 4/2008.
15 See A. Afonso and D. Furceri, “Government size, composition,
volatility and economic growth”, Working Paper Series, No 849,
FISCAL MULTIPLIERS – EMPIRICAL EVIDENCE
ECB, 2008.
16 See O. Blanchard and R. Perotti, “An empirical characterization
There is a wide body of literature which studies
of the dynamic effects of changes in government spending and
taxes on output”, Quarterly Journal of Economics, 117, 2002
the size of ﬁ scal multipliers, i.e. the impact
pp. 1329-68; A. Afonso and R. Sousa, “The macroeconomic
of a change in ﬁ scal variables on the level of
effects of ﬁ scal policy”, Working Paper Series, No 991,
output. For instance, available evidence from
ECB, 2009; and M. Kirchner, J. Cimadomo, S. Hauptmeier,
“Transmission of government spending shocks in the euro
structural Bayesian VAR approaches for the
area: time variation and driving forces”, Tinbergen Institute
United States, the United Kingdom, Germany
Discussion Papers, TI 2010-021/2, 2010.
17 See P. van Brusselen, “Fiscal stabilisation plans and the outlook
and Italy ﬁ nd that government spending shocks,
for the world economy”, ENEPRI Working Papers, No 55, 2009.
in general, have a small but positive effect on 18 Case studies, or narrative evidence of ﬁ scal news, lead to
GDP. In addition, ﬁ scal spending multipliers
larger ﬁ scal multipliers than those in standard ﬁ scal VARs.
See C. Favero and F. Giavazzi, “Reconciling VAR-based and
are positive but relatively small in the euro area,
narrative measures of the tax-multiplier”, IGIER Working
and time-varying VAR analysis reports that
Papers, No 360, 2010; and V. Ramey and M. Shapiro, “Costly
capital reallocation and the effects of government spending”,
ﬁ scal spending multipliers went up to about one
Carnegie-Rochester Conference Series on Public Policy, 48,
in 1985 and then fell to about 0.5 in 2008.16
1998, pp. 145-94.
ECB
72 Monthly Bulletin
July 2010

A R T I C L E S
policy is typically applied also makes it difﬁ cult Table 1 gives a breakdown of the different ﬁ scal
The effectiveness
to generalise the results from the limited number measures implemented at the euro area level,
of euro area
fiscal policies
of episodes of discretionary ﬁ scal expansions.19
as estimated by the European Commission.
In total, the ﬁ scal stimulus measures amount to
Additional available evidence also indicates that 1.1% and 0.8% of GDP in the years 2009 and
a higher public debt-to-GDP ratio reduces the 2010 respectively. These ﬁ scal measures have
effectiveness of ﬁ scal policy. Therefore, a ﬁ scal been implemented in addition to the stimulus
stimulus in the presence of lower government provided through the operation of automatic
indebtedness can have a stronger effect on the ﬁ scal stabilisers and do not include other extra-
economic recovery relative to a situation of budgetary actions such as capital injections,
higher government indebtedness.20
loans and guarantees to non-ﬁ nancial ﬁ rms and
investment by public corporations.
Several studies suggest that the efﬁ cacy of a
ﬁ scal stimulus based on government spending Table 1 reveals that, within the EERP, support
can vary widely, depending on the monetary for households’ purchasing power accounts for
and ﬁ scal policy regimes, i.e. how strongly the about 40% of the total stimulus in the euro area
monetary and ﬁ scal policies react to variations countries in 2009-10. These ﬁ scal measures have
in the state of the economy, including the level taken the form of a reduction in direct taxes, social
of government indebtedness, as well as a range security contributions and VAT, as well as direct
of other factors such as the size of the country, aid, such as income support for households and
the degree of openness and other institutional support for housing or property markets. Notable
factors. In this respect, structural models provide
stimulus measures have also been adopted to
a clear advantage with respect to empirical support investment and businesses directly.
VAR-based approaches in the assessment of These categories account for roughly 30% and
the role of different policy and institutional 20% of the total stimulus respectively. Support
environments on the efﬁ cacy of ﬁ scal stimulus for investment has primarily taken the form of
measures. They also allow for the consideration public (infrastructure) investment, while the
of different ﬁ scal policy instruments.
measures directly targeted at supporting business
activity have mainly been aimed at reducing
business costs (reduction of taxes and social
4
EFFECTIVENESS OF FISCAL POLICY
security contributions, direct aid in the form
IN STRUCTURAL MODELS
19 See, for example, T. Davig and M. Leeper, “Monetary-ﬁ scal
Governments in the euro area have responded to
policy interactions and ﬁ scal stimulus”, The Federal Reserve
Bank of Kansas City, RWP 09-12, 2009.
the economic crisis with a range of ﬁ scal stimulus 20 See Chapter 3 of IMF, “World economic outlook: crisis and
measures within the framework of the EERP.
recovery”, April 2009.
Table 1 Composition of fiscal stimulus packages in the euro area in 2009-10
(as a percentage of GDP)
2009
2010
Corresponding ﬁ scal instruments in the New Area-Wide Model
Measures aimed at households
0.4
0.3
Transfers and labour income taxes to all households; consumption taxes
Increased spending on labour market measures
0.1
0.1
Government consumption
Measures aimed at businesses
0.2
0.2
Payroll taxes; capital income taxes; private investment tax credits
Increased public investment
0.3
0.2
Government investment
Total
1.1
0.8
Sources: “Public ﬁ nances in EMU 2009”, European Economy 5/2009, p. 14, Table I.1.1, European Commission, 2009. Discrepancies arise
as a result of rounding. For 2010, only the total size of stimulus measures is available. The individual measures for 2010 are calculated
using the shares in the total stimulus in 2009.
Note: In the case of multiple ﬁ scal instruments in the New Area-Wide Model, it is assumed that the stimulus measures are allocated
proportionally to each instrument.
ECB
Monthly Bulletin
July 2010
73

Table 2 Economic effects of the euro area fiscal stimulus in the New Area-Wide Model
(percentage; percentage points)
2009 2010 2011 2012 2013
Real
GDP
0.7 0.6 0.1 0.1 0.1
Headline CPI inﬂ
ation
-0.2 0.1 0.1 -0.1 -0.1
Government deﬁ
cit-to-GDP
ratio
0.6 0.7 -0.2 -0.4 -0.3
Government
debt-to-GDP
ratio
-0.1 0.7 1.2 0.9 0.6
Notes: Real GDP is expressed in percentage deviations from the baseline which is the calibrated steady-state solution of the model. All
other variables are expressed as percentage point deviations from the baseline.
of earlier payment of VAT returns, subsidies and stability aspects and possible repercussions from
the stepping up of export promotion). Labour the heightened risk to ﬁ nancial stability on account
market measures (wage subsidies and active of the deteriorating ﬁ scal balance. The simulations
labour market policies) account for about 10% of also consider the euro area as a whole and
the total stimulus and thus represent the smallest hence do not address the speciﬁ c circumstances
fraction of the total stimulus measures.21
of diverse ﬁ scal positions within the euro area.
The ECB’s New Area-Wide Model (NAWM) 22 Table 2 shows the simulation results from the
has been used to illustrate, by means of NAWM. The impact on real GDP in 2009 and
simulations, the likely economic effects of 2010 (relative to the steady-state baseline) is
the EERP. To this end, Table 1 also provides positive, amounting to about 0.7% and
information on how the different ﬁ scal measures 0.6% respectively.23, 24 Assuming that the ﬁ scal
implemented within the framework of the EERP stimulus measures are lifted in 2011, the effects
were allocated to the NAWM’s ﬁ scal variables on real GDP fade away rather quickly.
in the simulation exercise. Because of the The response of headline CPI inﬂ ation is muted,
unavoidably imperfect match between the exact
ﬁ scal stimulus measures adopted by the euro 21 See “Public ﬁ nances in EMU”, European Economy, 5/2009,
area member countries and the NAWM’s ﬁ scal
European Commission, 2009.
variables, a certain amount of judgement was 22 The analysis is based on the NAWM version described in
R. Straub and I. Tchakarov, “Assessing the impact of a change
needed. For instance, labour market measures
in the composition of public spending - a DSGE approach”,
were allocated to government consumption
Working Paper Series, No 795, ECB, 2007. In the model, the
since they are primarily active labour market
ﬁ scal authority adjusts lump-sum taxes in response to deviations
of the government debt-to-GDP ratio from 60%, in line with the
policies, the costs of which are paid for by the
Maastricht Treaty. The monetary authority follows a standard
government. Nevertheless, keeping the above-
Taylor rule in terms of consumer price inﬂ ation and deviation
mentioned caveat in mind, the simulations
from its price stability objective (excluding the ﬁ rst-round effects
of changes in consumption taxes) and the output gap. In the
broadly reﬂ ect the actual EERP measures.
NAWM, households differ with respect to their ability to access
ﬁ nancial markets. A ﬁ xed proportion of 75% of households
are assumed to be Ricardian (not liquidity constrained) and the
In the NAWM, the paths of ﬁ scal instruments
remaining 25% of households are assumed to be non-Ricardian
speciﬁ
ed in Table 1 are imposed and the
(liquidity constrained), with non-Ricardian households having a
endogenous response of the economy is
higher propensity to consume.
23 Owing to the temporary nature of the ﬁ scal stimulus, and since the
simulated. It is assumed that the stimulus is
physical capital stock adjusts slowly in the model, the increase in
initially fully debt-ﬁ nanced. Within the ﬁ rst two
real GDP is mostly generated by an increase in employment.
24 The effects of the EERP on, for example, real GDP, as estimated
years, the nominal interest rate and lump-sum
on the basis of the NAWM, are somewhat smaller than those
taxes are kept constant. Thereafter, the nominal
obtained with the European Commission’s Quest III model
interest rate is adjusted according to a Taylor rule
(see “Public ﬁ nances in EMU”, European Economy, 5/2009,
European Commission). The differences reﬂ ect alternative
and lump-sum taxes are adjusted gradually to
modelling assumptions (e.g. regarding the importance of liquidity
reduce the government debt-to-GDP ratio to its
and credit-constrained households) and a somewhat different
design of the simulations. For instance, increasing the share of
long-run target of 60%. Note that the model-based
non-Ricardian households from 25% to 50% would make the
simulations do not explicitly consider ﬁ nancial
real GDP effects about 0.1% larger in 2009-10 in the NAWM.
ECB
74 Monthly Bulletin
July 2010

A R T I C L E S
amounting to -0.2 percentage point in 2009 and Table 1 reveals that the division of revenue and
The effectiveness
0.1 percentage point in 2010. The impact on the expenditure measures is roughly 50/50, which
of euro area
fiscal policies
government deﬁ
cit-to-GDP ratio amounts to produces the overall EERP GDP multiplier
0.6 percentage point in 2009 and 0.7 percentage reported above. These considerations lead to
point in 2010, followed by improvements in the the conclusion that the ﬁ scal stimulus packages
budget balance from 2011 onwards. The could have been more effective in stimulating
government debt-to-GDP ratio falls slightly in output and employment if, for example, a larger
the ﬁ rst year (because of the positive denominator
portion of the packages had been devoted to
effect in 2009), but then the impact turns positive measures that temporarily enhance public or
and remains at an elevated level, peaking at private investment.
1.2 percentage points in 2011.25
All in all, the simulations suggest that the output
Taking into account the allocation of the ﬁ scal gains of temporary ﬁ scal stimulus measures are
stimulus measures provided in Table 1, these positive, albeit short-lived. At the same time,
results are well aligned with the more detailed the stimulus packages have also contributed to a
analysis of ﬁ scal multipliers given in Box 2. further deterioration of ﬁ scal balances. Many euro
In particular, according to the simulations, the area countries have been slow in implementing
average two-year GDP multiplier of the EERP ﬁ scal exit and consolidation strategies. This
is about 0.7, which is well within the range of gives rise to increased risk to ﬁ nancial stability
individual instrument multipliers from 0 to 2 by weakening public conﬁ dence in the capacity
reported in Box 2 (see Table B, Column I). Box 2 of governments to restore the sustainability
also provides a detailed explanation of the fact of public ﬁ nances. This underlines the utmost
that temporary expenditure-based ﬁ scal measures importance of a swift implementation of credible
have larger multipliers than temporary revenue-
consolidation strategies in order to re-establish
based ﬁ scal measures, since the former stimulate ﬁ scal balance in the aftermath of the crisis.
aggregate demand directly and more effectively.
In particular, expenditure-based multipliers range
from 0.3 to 2, while revenue-based multipliers 25 The presence of Ricardian households implies a negative wealth
effect in response to the anticipated future tax increase, so that
range from 0 to 0.4 (see Table B, Column I in
short-run real GDP is affected negatively by the initial rise in
Box 2). The composition of the EERP given in
government debt.
Box 2
FISCAL MULTIPLIERS IN GENERAL EQUILIBRIUM MODELS1
Given the widespread resort to ﬁ scal policy as a tool to ﬁ ght the collapse in demand following
the economic and ﬁ nancial crisis, academia and policy institutions have recently produced
a considerable amount of research on the effects of ﬁ scal stimuli using structural general
equilibrium models. The ﬁ ndings of this research suggest that a key factor is the design of the
ﬁ scal stimulus itself, e.g. the ﬁ scal instrument chosen, the duration of the stimulus, whether the
nominal interest rate is kept constant or not, and the way it is ﬁ nanced.2
1 This box is largely based on G. Coenen, J. Kilponen and M. Trabandt, “When does ﬁ scal stimulus work?”, Research Bulletin, No 10, ECB, 2010.
2 See, for example, the following recent papers: L. Christiano, M. Eichenbaum and S. Rebelo, “When is the government spending
multiplier large?”, NBER Working Paper, No 15394, 2009; J. F. Cogan, T. Cwik, J. B. Taylor and V. Wieland, “New Keynesian versus
Old Keynesian government spending multipliers”, Journal of Economic Dynamics and Control, 34, 2009, pp. 281-295; G. Corsetti,
A. Meier and G. Müller, “Fiscal stimulus with spending reversals”, IMF Working Paper, No 09/106, 2009; C. Erceg and J. Lindé, “Is
there a ﬁ scal free lunch in a liquidity trap?”, CEPR Discussion Paper, No 7624, 2010; R. Hall, “By how much does GDP rise if the
government buys more output?”, NBER Working Paper, No 15496, 2009; and M. Woodford, “Simple analytics of the government
expenditure multiplier”, NBER Working Paper, No 15714, 2010.
ECB
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July 2010
75

The quantitative importance of several of these factors was analysed in a model comparison
exercise coordinated by the IMF in spring 2009.3 The models compared, including the
ECB’s NAWM, share many features such as forward-looking behaviour on the part of
households and ﬁ rms, nominal and real rigidities, as well as liquidity and/or credit constraints.
Hence, the models depart from the Ricardian equivalence hypothesis discussed in Box 1.
The models are calibrated to, or estimated for, the United States, the euro area/EU and the rest
of the world. Reﬂ ecting the differences between these economic areas, the models feature, inter
alia, different degrees of price stickiness, different proportions of liquidity/credit-constrained
households and different degrees of openness. In all the models, monetary and ﬁ scal policies are
characterised by simple feedback rules.
Table A reports the ranges of ﬁ scal multipliers and inﬂ ation effects obtained from different
models for the euro area/EU. The effects are shown under two different assumptions, namely
that the nominal interest rate reacts in accordance with an interest rate feedback rule, and that
the nominal interest rate remains unchanged for two years. It can be seen that the government
consumption multipliers are remarkably similar across models when the nominal interest rate
adjusts (close to, but below one). A constant nominal interest rate – resembling a situation in
which the central bank may not want to counteract the inﬂ ationary effects of a ﬁ scal stimulus –
increases the multiplier in all models. When the central bank raises nominal interest rates in
accordance with a feedback rule, the multiplier ranges from 0.7 to 0.8, while under a ﬁ xed
nominal interest rate the multiplier ranges from 1.1 to 1.7.
The sizeable difference in the multipliers relates to the differing reactions of the real interest rate.
Under a ﬁ xed nominal interest rate, and because of emerging price pressures, the real interest rate
falls, while when the nominal interest rate adjusts, the real interest rate rises. In the latter case, the
increase in the real interest rate causes households and ﬁ rms to postpone their consumption plans
3 For details, see G. Coenen, C. Erceg, C. Freedman, D. Furceri, M. Kumhof, R. Lalonde, D. Laxton, J. Lindé, A. Mourougane, D. Muir,
S. Mursula, C. de Resende, J. Roberts, W. Roeger, S. Snudden, M. Trabandt and J. in’t Veld, “Effects of ﬁ scal stimulus in structural
models”, IMF Working Paper, No 10/73, 2010.
Table A GDP multipliers and the impact on CPI inflation based on models for the euro area/EU
(percentage; percentage points)
GDP multiplier
Headline CPI inﬂ ation
Variable nominal
Two-year constant
Variable nominal
Two-year constant
interest rate
nominal interest rate
interest rate
nominal interest rate
Increases in expenditure
Government consumption
0.7 - 0.8
1.1 - 1.7
0.0 - 0.1
0.2 - 0.3
Government investment
0.8 - 1.1
1.1 - 1.6
0.0 - 0.1
0.1 - 0.3
Transfers to all households
0.0 - 0.2
0.1 - 0.5
0.0 - 0.1
0.1 - 0.1
Transfers to non-Ricardian households
0.1 - 0.6
0.6 - 1.2
0.1 - 0.2
0.2 - 0.3
Reductions in revenue
Labour income taxes
0.1 - 0.3
0.0 - 0.8
-0.1 - 0.0
-0.1 - 0.1
Consumption taxes
0.2 - 0.3
0.4 - 1.0
0.0 - 0.0
0.1 - 0.2
Capital income taxes
0.1 - 0.1
0.1 - 0.2
0.0 - 0.0
0.0 - 0.1
Notes: This table provides the ranges (min-max) of the GDP multiplier and the impact on headline CPI inﬂ ation (excluding
the direct effect of consumption tax changes) across models. The ﬁ scal multipliers are calculated as the two-year average
percentage deviation of real GDP from baseline GDP. The impact on CPI inﬂ ation is measured as the annualised two-year
average percentage point deviation from baseline inﬂ ation. All ﬁ scal stimuli are standardised to 1% of baseline GDP. Except
for capital income taxes, the models are the European Commission’s QUEST model, the IMF’s GIMF model, the ECB’s
NAWM and the OECD’s Small Fiscal Model. For capital income taxes the models are QUEST and GIMF. The ﬁ scal stimulus is
assumed to last for two years with full reversal to the baseline afterwards. During the ﬁ rst two years, the ﬁ scal stimulus is fully
debt-ﬁ nanced.
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A R T I C L E S
The effectiveness
and to reduce investment in physical capital. Under a ﬁ xed nominal interest rate, the fall in the
of euro area
real interest rate leads to higher consumption and investment spending than in the endogenous
fiscal policies
interest rate response case.
The results shown in Table A also highlight that the ﬁ scal instruments which directly stimulate
aggregate demand (government consumption and investment) or targeted transfers (i.e. transfers
to non-Ricardian households that consume their labour income in each period) lead to higher
ﬁ scal multipliers than tax cuts in the short run. The difference in the ﬁ scal multipliers is related
to the strength of the implied negative wealth effects. In the case of temporary government
spending increases, the negative wealth effect of government spending (i.e. the increase in the
present value of future tax payments required to balance the government’s budget over time) is
small. Hence, the crowding-out of private spending is limited when the ﬁ scal stimulus is short-
lived. By the same argument, temporary tax cuts have only small effects on private spending
since the implied favourable wealth effect is small.
What affects the ﬁ scal multiplier? Results from the NAWM
Using the NAWM, Table B shows how the ﬁ scal multipliers for the euro area are affected
by various assumptions concerning the economic environment as well as by alternative ﬁ scal
instruments. These alternative assumptions or instruments reﬂ ect, to the extent possible,
the various differences in country speciﬁ c characteristics in the euro area.
Several interesting results emerge in the benchmark case (see Column I), in which the two-year
constant nominal interest rate assumption is used in order to reﬂ ect the exceptional circumstances
of the crisis. First, the NAWM ﬁ scal multipliers tend to be located towards the lower end
Table B Euro area GDP multipliers: results from the NAWM
Benchmark Variable
One-
Delayed Gradual
More Government
More
More
nominal
year stimulus
stimulus
non-
bond yield ﬂ exible
open
interest stimulus
removal
Ricardian
risk premia
prices economy
rate
households
I
II
III
IV
V
VI
VII
VIII
IX
Increases in expenditure
Government consumption
1.2
0.8
0.6
0.8
0.6
1.2
1.1
1.3
1.1
Government investment
1.1
0.9
0.6
0.8
0.5
1.2
1.0
1.2
1.0
Transfers to all households
0.3
0.1
0.1
0.1
0.3
0.4
0.2
0.4
0.2
Private investment subsidy
(tax credit)
2.0
1.0
0.6
1.6
1.4
2.1
2.1
2.4
0.9
Reductions in revenue
Labour income taxes
0.0
0.1
0.1
0.1
0.0
0.2
-0.1
0.0
0.1
Consumption taxes
0.4
0.3
0.2
0.2
0.2
0.5
0.3
0.5
0.3
Firms’ payroll taxes (social
security contributions)
0.1
0.3
0.1
0.2
-0.1
0.1
-0.1
-0.4
0.3
Capital income taxes
0.1
0.1
0.0
0.2
0.5
0.2
0.0
0.2
0.1
Notes: This table provides the GDP multipliers for the euro area from the ECB’s NAWM for various ﬁ scal instruments and model
speciﬁ cations. The multiplier is calculated as the average percentage deviation of GDP from its baseline during the ﬁ rst two years. The ﬁ scal
stimulus is standardised to 1% of baseline GDP and is initially fully debt-ﬁ nanced. After the end of the ﬁ scal stimulus, lump-sum taxes are
adjusted to reduce the government debt-to-GDP ratio to its long-run target of 60%. In the benchmark case, the ﬁ scal stimulus lasts for two
years with full reversal to the baseline afterwards and the monetary authority keeps the interest rate ﬁ xed during the ﬁ rst two years.
ECB
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77

of the ranges reported in Table A on account of alternative modelling assumptions (e.g. regarding
the importance of liquidity-constrained households and the degree of nominal rigidities). Second,
the results conﬁ rm the earlier ﬁ nding that temporary expenditure-based ﬁ scal stimuli generally
lead to higher multipliers than revenue-based stimuli. Third, of all the instruments, subsidies for
private investment produce the largest multiplier since they provide the strongest incentives to
invest in productive capacity, which eventually ampliﬁ es the initial stimulus. Fourth, reductions
in ﬁ rms’ social security contributions have only a small effect on output, since the
temporary nature of the stimulus does not induce ﬁ rms to lower prices enough to stimulate
demand. This is due to the presence of relatively high nominal rigidities in the euro area.
In line with the ﬁ ndings of the IMF model comparison exercise, a variable nominal interest rate
(see Column II) reduces the multiplier for expenditure measures owing to the increase in the real
interest rate relative to the benchmark case.
If a stimulus of one year instead of two years (see Column III) is assumed, the multiplier falls owing
to the presence of nominal and real rigidities, preventing propagation of a shorter ﬁ scal stimulus.
On the other hand, Table B also shows that ﬁ scal expansions that go well beyond two years
(see Column V) lead to considerably lower output responses, i.e. deliver smaller multipliers.
The reason is that more persistent expansions result in a larger increase in the present discounted
value of future tax payments, and thus in a larger negative wealth effect.4
It has been argued that ﬁ scal stimuli are subject to decision or implementation lags. Column IV
of Table B shows that a ﬁ scal stimulus delayed by one year reduces the multiplier as a result
of anticipation effects. In particular, consumption smoothing motives, in conjunction with the
anticipation of negative wealth effects, induce households to increase savings, which reduces the
multiplier.
Empirical evidence suggests that the ﬁ nancial and economic crisis has increased the share
of liquidity or credit-constrained (non-Ricardian) households. Assuming a share of non-
Ricardian households of 50% (see Column VI) instead of 25% increases the multiplier since
ﬁ scal measures directly or indirectly increase the disposable income of these households.
Quantitatively, however, the effect is rather limited, which suggests that the effect of the higher
proportion of non-Ricardian households is offset by the behaviour of Ricardian households.
Column VII in Table B shows that the multiplier falls if government bond yield risk premia are
taken into account in the analysis. The ﬁ scal stimulus is initially ﬁ nanced by government debt.
On account of risk premia, households save more in anticipation of a higher stock of outstanding
government debt that needs to be repaid by increased future taxes. This reduces the multiplier.
In countries with more ﬂ exible prices (see Column VIII), the expenditure-based multipliers
increase if the nominal interest rate is kept constant. The stronger increase in inﬂ ation in response
to the stimulus translates into a more pronounced fall in the real interest rate, which eventually
stimulates aggregate demand more effectively.
Finally, a higher degree of openness (Column IX) decreases the multiplier as some of the
domestic ﬁ scal stimulus spreads to the rest of the world via trade and capital markets.
4 See also the box entitled “The effectiveness of various ﬁ scal measures to stimulate the economy” in the March 2009 issue of the
Monthly Bulletin, pp. 78-80.
ECB
78 Monthly Bulletin
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A R T I C L E S
The effectiveness
Overall, these results suggest that spending multipliers are, on average, most sensitive to
of euro area
assumptions regarding whether the nominal interest rate is kept constant or not, and to the length
fiscal policies
of the ﬁ scal stimulus. Tax multipliers, in turn, are most sensitive to assumptions concerning
government bond yield premia and the degree of price stickiness. In a few cases, reductions in
taxes can be counter-productive (negative multiplier). The reason is that with a ﬁ xed nominal
interest rate, lower taxes imply a reduction in inﬂ ation and hence a higher real interest rate,
which crowds out private demand. This again reﬂ ects the importance of the real interest rate
channel in transmitting the ﬁ scal response to private spending.
Finally, the highest spending multiplier is associated with investment tax credits, while the highest
tax multiplier is associated with consumption taxes. The lowest spending and tax multipliers are
found for transfers to all households and reductions in labour taxes, respectively.
5
COSTS AND BENEFITS OF FISCAL
projected by the Commission to show a deﬁ cit
CONSOLIDATION
of 6.1% of GDP in 2011, as a result of an upward
shift in the spending ratio and a steady decline
Expansionary ﬁ scal policies and the operation in revenues relative to GDP.
of automatic stabilisers, together with strong
revenue shortfalls, have contributed to a sharp Against this background, the euro area
deterioration of euro area public ﬁ nances and government debt-to-GDP ratio, also affected
have endangered the long-term sustainability by government support to stabilise the ﬁ nancial
of public ﬁ
nances. The rapid deterioration sector, continues to rise even as the recovery
of the ﬁ scal outlook is illustrated in Chart 1. takes place and the temporary ﬁ scal stimulus
After having been close to balance in 2007, measures fade away (see Chart 2). Indeed, after
the euro area general government budget is having declined from roughly 72% of GDP
Chart 1 Euro area budget balance and its
Chart 2 Euro area general government debt,
components over the period 1999-2011
1999-2011
(as a percentage of GDP)
(as a percentage of GDP)
cyclical component of budget balance (left-hand scale)
fiscal stimulus packages (left-hand scale)
cyclically adjusted budget balance (excluding fiscal
stimulus) (left-hand scale)
government budget balance (left-hand scale)
total government expenditure (right-hand scale)
total government revenue (right-hand scale)
7
90
90
52
5
85
85
48
3
80
80
1
44
75
75
-1
40
70
70
-3
36
-5
65
65
-7
32
60
60
1999
2001
2003
2005
2007
2009
2011
1999
2001
2003
2005
2007
2009
2011
Sources: European Commission, European Economic Forecast –
Sources: European Commission, European Economic Forecast –
Spring 2010.
Autumn 2009 for 1999 and 2000 and European Economic
Notes: Data for 2010 and 2011 are projections. It is assumed that
Forecast – Spring 2010 for the remaining years.
one-third of the 2010 ﬁ scal stimulus remains in 2011.
Note: Data for 2010 and 2011 are projections.
ECB
Monthly Bulletin
July 2010
79

in 1999 to 66% of GDP in 2007, the euro area deﬁ cits, then the resulting short-run output
government debt-to-GDP ratio increased to costs could be considered as mirror images of
69.4% in 2008 and is projected to rise further ﬁ scal stimulus programmes. In other words, if a
to 88.5% in 2011.
temporary ﬁ scal stimulus increases real GDP by
1% , a temporary consolidation should reduce
Given the size of the accumulated ﬁ scal real GDP by 1%. Thus, the ﬁ scal multiplier
imbalances, ambitious ﬁ scal consolidation analysis discussed in Box 2 could be interpreted
efforts over a longer horizon must clearly be as a ﬁ scal consolidation analysis with the signs
an integral part of the exit strategy to bring of the real GDP responses reversed.
public ﬁ nances in line with the provisions of
the Stability and Growth Pact. This section However, it should be emphasised that ﬁ scal
addresses the macroeconomic effects of ﬁ scal consolidation programmes, when appropriately
adjustment with a particular focus on the designed, aim to achieve permanent rather than
short-run costs and potential long-run beneﬁ ts temporary improvements in ﬁ scal balances.
with respect to euro area real GDP. In order to Permanent improvements in ﬁ scal balances,
facilitate comparability with the results provided
in turn, when anticipated by households and
in the previous section, the term “short-run” ﬁ rms, can lead to positive expectation effects
refers to the deviation of real GDP from its that mitigate the short-run costs of ﬁ scal
initial level during the ﬁ rst two years. The term consolidation, as discussed in Section 2.
“long-run” refers to the deviation of real GDP
relative to its initial level after full adjustment Using the ECB’s NAWM, Table 3 illustrates the
has taken place.
short-run and long-run effects of ﬁ scal
consolidation under various assumptions on
As a natural starting point, the question arises how the consolidation is achieved.26
whether ﬁ scal stimulus and ﬁ scal consolidation The simulations are not intended to give an
output multipliers are symmetric. If ﬁ scal 26 For a related analysis see G. Coenen, M. Mohr and R. Straub,
consolidation programmes aimed to achieve
“Fiscal consolidation in the euro area: long-run beneﬁ ts and
only temporary reductions of government
short-run costs”, Working Paper Series, No 902, ECB, 2007.
Table 3 Costs and benefits of fiscal consolidation: NAWM simulation results
(percentage; percentage points)
Without conﬁ dence effects
Including conﬁ dence effects
Short-run
Long-run
Short-run
Long-run
real
real
labour
real
real
labour
GDP
GDP
tax
GDP
GDP
tax
Permanent reductions in expenditure
Government consumption
-0.6
0.4
-4.0
-0.4
1.8
-4.3
Government investment
-0.7
-1.7
-2.6
-0.5
-0.3
-3.0
Transfers to all households
0.3
1.6
-4.4
0.5
3.0
-4.7
Transfers to non-Ricardian households
0.6
2.2
-4.8
0.8
3.6
-5.1
Permanent increases in revenue
Labour income taxes
-0.3
0.5
-1.8
-0.1
1.9
-2.2
Consumption taxes
-0.1
0.9
-4.0
0.1
2.3
-4.3
Firms’ payroll taxes (social security contributions)
-0.6
0.5
-3.0
-0.4
1.9
-3.3
Capital income taxes
-0.4
-1.1
-3.9
-0.2
0.4
-4.1
Notes: This table shows the effects of a permanent reduction in the euro area debt-to-GDP ratio from 90% to 60%, implemented through
various ﬁ scal instruments, using the ECB’s NAWM. Each ﬁ scal instrument is assumed to be adjusted by 1% of the initial steady-state
GDP. The budgetary room created by the consolidation is, starting after ten years, partly used to reduce distortionary labour income
taxes. Real GDP is measured in terms of percentage deviations from its initial steady state. The labour tax rate is measured in terms of
percentage point deviations from its initial steady state. “Short-run” refers to the average percentage deviation of real GDP from its initial
steady state during the ﬁ rst two years. “Long-run” refers to the percentage/percentage-point deviation of variables at their new steady
states relative to their initial steady states. The panel “Including conﬁ dence effects” shows the effects when the equilibrium long-term
interest rate falls permanently by 30 annual basis points in response to the permanent consolidation.
ECB
80 Monthly Bulletin
July 2010

A R T I C L E S
exact quantitative account of ﬁ scal consolidation, Interestingly, the fall in the labour tax rate,
The effectiveness
but merely illustrate key factors that matter for which has a positive effect on employment,
of euro area
fiscal policies
the determination of its long-run beneﬁ ts and cannot fully compensate for the fall in
short-run costs.
economy-wide capital, which means that a
negative long-run impact on real GDP remains.
Reﬂ ecting the foreseen increase in the debt-to-
GDP ratios in the euro area countries, the The short-run costs of ﬁ scal consolidation
simulations consider the effects of a permanent are typically small relative to the permanent
30 percentage point reduction in the debt-to-
gains. In some cases (reductions in transfers),
GDP ratio (from 90% to 60%) in line with the there may even be positive short-run effects on
reference value for the debt ratio in the Treaty.27 account of a strong negative wealth effect that
The permanent reduction in the debt-to-GDP gives rise to an increase in labour supply.
ratio, implemented through a standardised 1%
change in a particular ﬁ scal instrument, creates The reduction in the government debt-to-GDP
budgetary room, which is allocated over the ratio is endogenous and evolves gradually. For
medium to longer term to reductions in instance, in the case of a permanent reduction in
distortionary labour income taxes.28, 29
government consumption of 1% of initial steady-
state GDP, the government debt-to-GDP ratio
Table 3 shows that several ﬁ scal instruments is reduced by about 10 percentage points after
result in sizeable long-run beneﬁ ts, measured ten years, 15 percentage points after 15 years
in terms of real GDP, which are triggered by and 20 percentage points after 22 years.
a reduction in distortionary labour income tax
rates in the long run. This is a consequence of INCLUDING CONFIDENCE EFFECTS
the newly available budgetary room and of the
dynamic gains resulting from higher productivity Table 3 also provides results for the case in
and capital accumulation. For reasons that will which positive conﬁ
dence effects (labelled
be explained below, the assessment of the short-
“Including conﬁ dence effects”) are accounted
run costs (ﬁ rst two years) and long-run beneﬁ ts for, by giving rise to a permanent reduction in
of ﬁ
scal consolidation depends on whether the long-term interest rate and hence the
conﬁ dence effects are taken into account or not. ﬁ nancing costs of government debt. A permanent
As suggested in Section 2, in the analysis below, reduction in ﬁ nancing costs makes the long-run
positive conﬁ dence effects are accounted for via a beneﬁ ts of ﬁ
scal consolidation considerably
permanent reduction in the long-term interest rate
and hence lower government debt ﬁ nancing costs. 27 For a record of successful historical debt reductions of similar or
even larger size, see, for example, the box entitled “The Greek
economic and ﬁ nancial adjustment” in the May 2010 issue of
WITHOUT CONFIDENCE EFFECTS
the Monthly Bulletin.
28 The budgetary room created by the consolidation is used
exclusively to reduce government debt within the ﬁ rst ten years.
Starting with the case in which the long-term
Thereafter, labour income taxes are allowed to adjust in response
interest rate is unaffected by the permanent ﬁ scal
to deviations of the government deﬁ cit from its long-run target
consolidation (labelled “Without conﬁ dence
(which is in line with a 60% debt-to-GDP ratio).
29 Note that the set-up for the permanent consolidation simulation
effects” in Table 3), it turns out that long-run
is different from the one for the temporary ﬁ scal stimulus
beneﬁ ts are in the range of 0.4-2.2% of initial
measures. In the latter, the temporary increase in government
debt to ﬁ nance the stimulus initially is reversed by means of
steady-state real GDP. Two exceptions are
increases in lump-sum taxes in the medium term. As argued in
noticeable: reductions in government investment
the previous section, this anticipated temporary consolidation
and increases in capital income taxes lead to
(i.e. rise in future lump-sum taxes) induces a negative wealth
effect and thereby reduces the GDP multiplier. By contrast, in the
long-run declines in real GDP. Both measures
case of the permanent consolidations examined in this section,
have a negative impact on economy-wide
individual ﬁ scal instruments such as government consumption,
investment, consumption taxes, etc., are changed permanently
public and private capital stocks so that the
in order to achieve a permanent reduction in the government
productive capacity of the economy diminishes.
debt-to-GDP ratio.
ECB
Monthly Bulletin
July 2010
81

higher. The permanent reduction in ﬁ nancing There is considerable uncertainty about the
costs provides more room for budgetary degree to which governments can stimulate
manoeuvre, which is used to lower labour the economy with temporary counter-cyclical
income taxes, so that tax distortions are reduced ﬁ scal measures. The evidence reviewed in this
even further. Conﬁ dence effects also imply article shows that the efﬁ cacy of ﬁ scal policy
moderately lower short-run costs of consolidation,
is conditional on many factors, such as the
as lower ﬁ nancing costs boost domestic demand ﬁ scal instrument chosen, the persistence of the
directly and more sizeable long-run economic ﬁ scal stimulus, the initial level of government
gains are anticipated by households and ﬁ rms. indebtedness, whether the nominal interest rate
For example, in the case of government is kept constant or not, and price ﬂ exibility.
consumption, in comparison with the case in
which the conﬁ dence effects are not accounted Against this background, and taking into account
for, a permanent 30 basis point reduction in the the speciﬁ c features of the 2008-09 crisis,
ﬁ nancing costs of government debt provides an the evidence available so far suggests that the
additional long-run real GDP gain of 1.4% and ﬁ scal measures implemented have been broadly
0.2% lower short-run real GDP costs of ﬁ scal supportive for output, with the focus primarily
consolidation.30, 31 The relative gains from being on short-lived ﬁ scal stimulus.
conﬁ dence effects for the other ﬁ scal instruments
are also within the same order of magnitude.
At the same time, however, accommodating
the impact of automatic stabilisers and the
A comparison with the analysis of temporary implementation of counter-cyclical ﬁ scal
ﬁ scal multipliers from Table B in Box 2 policies during the crisis has come at a high
suggests that short-run costs are typically only cost for euro area public ﬁ nances. Having been
about half as large if permanent expenditure-
close to balance in 2007, the euro area general
based consolidation is considered. Further government budget is projected to show a deﬁ cit
simulation results suggest that long-run gains of 6.1% of GDP in 2011 and debt-to-GDP ratios
can be even higher if the additional budgetary are projected to rise signiﬁ cantly to 88.5% in
room created by the ﬁ scal consolidation is used 2011. These trends are clearly unsustainable,
to lower the capital income tax, instead of the and undermine conﬁ dence in the long-term
labour income tax.
sustainability of public ﬁ nances.
Overall, the simulations illustrate that ﬁ scal In the light of these developments, many euro
consolidation, when appropriately designed area countries have been too slow to implement
to take full advantage of long-run economic ﬁ scal exit and consolidation strategies, giving
gains, can be achieved with moderate short-run rise to increased risks to ﬁ nancial stability.
costs, while at the same time providing a pivotal This underlines the utmost importance of
step towards the restoration of long-run ﬁ scal restoring ﬁ scal balances in the aftermath of
sustainability in the euro area.
the crisis. Fiscal consolidation will need to
exceed substantially the annual structural
adjustment of 0.5% of GDP set as a minimum
6 CONCLUSIONS
requirement by the Stability and Growth Pact.
The global ﬁ nancial and economic crisis has 30 The 30 basis point reduction in the ﬁ nancing costs of government
put the effectiveness of ﬁ scal policy at centre
debt is based on empirical evidence on the relationship between
stage of the economic policy debate throughout
the level of government debt and government bond yields.
See, for example, T. Laubach, “New evidence on the interest
the world. Governments in the euro area have
rate effects of budget deﬁ cits and debt”, Journal of the European
responded to the prospect of a deep recession
Economic Association, 7(4), 2009, pp. 1-28.
31 In this particular case, real GDP reaches its initial level after
with a range of counter-cyclical ﬁ scal stimulus
about eight years, and half of the long-term beneﬁ t level is
measures within the framework of the EERP.
reached after about 20 years.
ECB
82 Monthly Bulletin
July 2010

A R T I C L E S
The main issue on the ﬁ scal side in the euro area
The effectiveness
is the total neglect by some countries of the fact
of euro area
fiscal policies
that they have had no room for ﬁ scal manoeuvre
at all. Countries that delay ﬁ scal consolidation
contribute to the ﬁ scal problems in the euro area
as whole. The longer the ﬁ scal correction is
postponed, the higher the risk of reputation and
conﬁ dence losses, the more painful the short-
run adjustment, and the further away the long-
run beneﬁ ts of ﬁ scal consolidation.
This article has offered an illustrative analysis of
permanent ﬁ scal consolidation programmes in
the euro area aimed at restoring long-run ﬁ scal
sustainability. The results clearly suggest that
the long-term economic gains of restoring sound
ﬁ scal positions in the euro area far outweigh the
short-run costs.
The simulation results also suggest that the
bulk of the ﬁ scal adjustment should be borne
on the expenditure side, in line with the
empirical evidence available, which points to a
higher degree of success for expenditure-based
ﬁ scal consolidation. Moreover, the additional
budgetary room created by the consolidation
efforts may be geared in the medium term
towards lowering the taxes that are most harmful
for labour supply and capital accumulation in the
long run (i.e. labour and capital income taxes).
ECB
Monthly Bulletin
July 2010
83

THE IMPACT OF THE FINANCIAL CRISIS ON THE
CENTRAL AND EASTERN EUROPEAN COUNTRIES
A R T I C L E S
The eight EU countries in central and eastern Europe outside the euro area (CEE) were strongly
The impact of
affected by the global ﬁ nancial crisis. However, the impact of the crisis varied signiﬁ cantly across
the financial crisis on
the central and eastern
countries. While Poland weathered the crisis relatively well, others experienced a considerable
European countries
decline in GDP, and the Baltic States, which were already in recession before the failure
of Lehman Brothers, faced a double-digit contraction in economic activity in 2009. These observed
variations relate partly to the cross-country cyclical differences before the intensiﬁ cation of the
crisis in September 2008 and, more crucially, the varying degrees to which countries had built up
external and internal imbalances and vulnerabilities prior to the crisis. In addition, cross-country
differences with respect to sectoral and regional trade specialisation and ﬁ nancial factors played a
role. Policy responses to the crisis have also varied signiﬁ cantly across countries, mainly reﬂ ecting
differences in the scope for manoeuvre – both on the ﬁ scal front and on the monetary policy front.
1
IMPACT OF THE CRISIS ACROSS
of the impact varied across countries, but also
COUNTRIES – STYLISED FACTS
the timing and speed at which countries were
affected by the crisis. In the Baltic States, GDP
When the global ﬁ nancial and economic crisis growth had already started to slow well ahead
intensiﬁ ed after the collapse of Lehman Brothers,
of September 2008, while in Hungary economic
the CEE countries were strongly affected, as activity started to contract in annual terms at the
reﬂ ected, for example, in a signiﬁ cant decline in end of 2008. In Bulgaria, the Czech Republic
GDP growth. Although they had been relatively and Romania, annual output growth was still
resilient until September 2008, the CEE
countries suffered as a result of heightened risk
aversion on the part of international investors
Chart 1 Real GDP growth
towards the CEE region, general deleveraging
by ﬁ
nancial institutions and a marked (average annual growth rates; quarterly data)
contraction in foreign demand. But the impact
Q1 2005-Q3 2008
of the crisis on GDP growth varied considerably
Q4 2008-Q3 2009
across countries. While Poland weathered the
Q4 2009-Q1 2010
crisis relatively well, being the only EU country
10
10
to record positive GDP growth in 2009, others
experienced a considerable decline in GDP, with
5
5
the Baltic States even recording a double-digit
contraction in economic activity (see Chart 1).
0
0
In general, those countries that had grown
-5
-5
particularly strongly in the years before the
crisis, namely Bulgaria, the Baltic States and
-10
-10
Romania, have subsequently seen the largest
declines in output. Three of the CEE countries,
-15
-15
namely Latvia, Hungary and Romania, also
had to request EU and IMF-led international
-20
-20
BG
EE
LV
LT
CZ
HU
PL
RO
ﬁ nancial assistance as a consequence of the
crisis. Cross-country cyclical differences, Source: Eurostat.
Notes: Data are working day and seasonally adjusted except
while already pronounced before the crisis, as
for Bulgaria (no adjustment) and Romania (only seasonally
adjusted). Data for the ﬁ rst quarter of 2010 are not available
compared, for example, with those in the euro
for Latvia. Countries to the left of the centre line have ﬁ xed
exchange rate regimes or currency board arrangements. Those
area countries, seem to have increased further
on the right have more ﬂ exible regimes with the central banks
pursuing inﬂ ation targeting strategies.
following the crisis. Moreover, not only the size
ECB
Monthly Bulletin
July 2010
85

relatively robust in the fourth quarter of 2008, over one year later. Inﬂ ation has started to increase
but turned negative in the ﬁ rst quarter of 2009. in recent months in a number of countries, while
For most countries, the trough of the decline Latvia was the only CEE country still displaying
in output occurred in the third quarter of 2009, negative inﬂ ation rates in May 2010.
therefore, this article analyses the impact of
the crisis in the period from the fourth quarter
of 2008 to the third quarter of 2009. Owing 2
IMPACT OF THE CRISIS ACROSS
mainly to a recovery in foreign demand, the
COUNTRIES – UNDERLYING CYCLICAL
decline in economic activity slowed in most
AND STRUCTURAL FACTORS
CEE countries in the ﬁ rst quarter of 2010, with
the Czech economy even starting to grow again.
PRE-CRISIS MACROECONOMIC IMBALANCES
HICP inﬂ ation, which had increased strongly To understand the cross-country differences
in most countries before the onset of the crisis, in the impact of the crisis, it is important to
generally declined sharply thereafter, although ﬁ rst look at the cyclical positions of the CEE
the degree and pace of the decline differed countries and the closely related macroeconomic
across countries (see Chart 2). The drop in imbalances existing when the ﬁ nancial crisis
inﬂ ation reﬂ ected mainly a decline in global intensiﬁ ed in September 2008. In fact, the
commodity prices, lower wage growth and a CEE countries were in very different cyclical
sharp fall in domestic demand. The sharpest positions when the ﬁ nancial crisis began. In
drop in inﬂ ation was experienced by Bulgaria the years preceding the crisis, a number of
and the Baltic States. These countries were them, in particular the Baltic countries, grew
still recording double-digit inﬂ ation rates rapidly, often at unsustainable rates, which led
in September 2008, before inﬂ ation declined to to a widening of the positive output gap and
zero or in some cases even turned negative just fostered the emergence of internal and external
imbalances. Owing to strong capital inﬂ ows and
credit growth – the latter fuelled by very low and
Chart 2 HICP inflation
in some cases even negative real interest rates –
several CEE countries experienced strong
(average annual growth rates; monthly data)
rises in asset prices, in particular house prices.
Wealth effects, in turn, further stoked excess
Jan. 2005-Sep. 2008
Oct. 2008-Sep. 2009
demand pressures. In a number of countries,
Oct. 2009-May 2010
especially Bulgaria, the Baltic States and
10
10
Romania, substantial wage increases, in some
8
8
cases accompanied by rapid public wage
growth, led to strong increases in unit labour
6
6
costs. Expansionary ﬁ scal policies also boosted
GDP growth ahead of the crisis and led to
4
4
signiﬁ cant structural budget deﬁ cits in 2007
2
2
in several countries, in particular the Czech
Republic, Hungary, Latvia, Lithuania, Poland
0
0
and Romania (see Chart 3).
-2
-2
Rising domestic demand pressures eventually
-4
-4
BG
EE
LV
LT
CZ
HU
PL
RO
translated into escalating inﬂ
ation and real
currency appreciation in some countries. This, in
Source: Eurostat.
Notes: Countries to the left of the centre line have ﬁ xed exchange
turn, further exacerbated the widening of current
rate regimes or currency board arrangements. Those on the right
have more ﬂ exible regimes with the central banks pursuing
and capital account deﬁ cits through an associated
inﬂ ation targeting strategies.
loss of competitiveness. As a consequence,
ECB
86 Monthly Bulletin
July 2010

A R T I C L E S
external deﬁ cits reached double-digit GDP ratios of foreign currency denominated debt in the
The impact of
in Bulgaria, the Baltic States and Romania before private sector, mainly in the form of mortgage
the financial crisis on
the central and eastern
the crisis (see Chart 3), exceeding levels that loans. The increasing share of foreign currency
European countries
could be explained by the countries’ catching-up lending in the CEE countries (for the most part
process alone.1 The high current and capital denominated in euro) accompanied – and may
account deﬁ cits contributed to the emergence of in some cases have contributed to – a strong
vulnerabilities, especially since a growing share expansion in overall credit (see Chart 4).
of the countries’ current account deﬁ cits was There were, however, important differences
ﬁ nanced by capital inﬂ ows that added to the between countries. While there was a strong
countries’ external debt levels. In addition, several
bias towards foreign currency loans in Estonia
countries, in particular the Baltic States, reported and Latvia (of around 80%), the share of foreign
that a large share of their external ﬁ nancing prior currency loans to the private sector in the
to the crisis took the form of “other investment” Czech Republic and Poland was only around
inﬂ ows. This is often perceived to be a less stable 10% and 25% respectively. The strong presence
form of ﬁ nancing than foreign direct investment. of foreign-owned banks and differentials
As a result, external indebtedness and ﬁ nancing between interest rates on loans in domestic
needs were at relatively high levels in many CEE and foreign currency were important factors
countries, making them vulnerable to a change in in explaining the pattern of foreign currency
investor sentiment.
lending in the CEE countries. Exchange rate-
related factors and expectations regarding the
Vulnerabilities to a change in investor sentiment
and, in some cases, the associated currency 1 See M. Ca’Zorzi, A. Chudik and A. Dieppe, “Current account
depreciations, were further exacerbated in some
benchmarks for central and eastern Europe: a desperate search?”,
countries by the fast build-up of a large stock
Working Paper Series, No 995, ECB, 2009.
Chart 3 Current and capital account
Chart 4 Growth of credit to the private
imbalances and structural fiscal deficits
sector
(percentages of GDP; 2007)
(average annual growth rates; January 2005-September 2008)
x-axis: structural fiscal deficit
loans in domestic currency
y-axis: current and capital account deficit
loans in foreign currencies
foreign currency loans; as a percentage of total loans
0
0
100
100
CZ
-5
-5
HU
PL
80
80
-10
-10
RO
60
60
-15
-15
LT
EE
40
40
-20
-20
LV
BG
20
20
-25
-25
-30
-30
0
0
-6
-5
-4
-3
-2
-1
0
BG
EE
LV
LT
CZ
HU
PL
RO
Sources: Eurostat and European Commission.
Source: ECB.
Notes: The share of foreign currency loans is calculated as an
average of the period from January 2005 to September 2008.
Countries to the left of the centre line have ﬁ xed exchange rate
regimes or currency board arrangements. Those on the right have
more ﬂ exible regimes with the central banks pursuing inﬂ ation
targeting strategies.
ECB
Monthly Bulletin
July 2010
87

adoption of the euro, especially in those countries
Chart 5 Real GDP and credit to the private
with ﬁ xed exchange rate regimes in place, may
sector
have also played a role. The high exposure to
sharp exchange rate movements implied major
(average annual growth rates; percentage points)
balance sheet risks for borrowers.
x-axis: growth of MFI loans to the private sector (year-on-year)
y-axis: real GDP growth (year-on-year)
CROSS-COUNTRY DIFFERENCES IN THE FALL
growth difference from the pre-crisis average
average growth
IN DOMESTIC DEMAND
10
10
The considerable decline in GDP growth
5
5
PL
that most CEE countries experienced after
0
0
CZ
PL
September 2008 was driven by both a collapse
BG
-5
-5
HU
RO
in exports and plummeting domestic demand.
HU
-10
-10
The turnaround from signiﬁ cant excess demand
BG CZ
LT
RO
EE
pressures to a sizeable fall in aggregate demand,
-15
-15
LV
with a rapid decline in inﬂ ation rates, was
LT
-20
-20
EE
most pronounced in those countries that had
LV
-25
-25
experienced the strongest overheating pressures
before the crisis and had allowed large external
-30
-30
-60
-40
-20
0
20
40
60
and internal imbalances to build up, as described
Sources: ECB and Eurostat.
above. These countries were particularly Notes: Growth differences from the pre-crisis average represent
the difference in average annual growth rates between the
severely affected by heightened risk aversion
period from Q4 2008 to Q3 2009 and the period from Q1 2005
on the part of international investors after
to Q3 2008; average growth rates comprise the period from the
fourth quarter of 2008 until the third quarter of 2009.
September 2008 and the general deleveraging
of ﬁ nancial institutions around the world after
the collapse of Lehman Brothers, which led to a Credit growth continued to decline in the ﬁ rst
sharp drop in cross-border capital ﬂ ows.
quarter of 2010 in all countries but Romania,
where it slightly increased. Furthermore, credit
Following a tightening in ﬁ nancing conditions, growth rates were still negative in the Baltic States
including the costs of ﬁ nancing,2 and the and Hungary, ranging between -5% and -7.5%.
signiﬁ cant deterioration in the economic outlook,
credit growth plunged in particular in those Against this background, investment contracted
countries that before the crisis had relied heavily in all CEE countries, although to varying degrees,
on foreign capital to ﬁ nance credit booms (i.e. the and contributed in all countries but Poland
Baltic States and Romania). This, in turn, may to the decline in GDP growth (see Chart 6).
explain the sharp contraction in output in these The sharpest fall in investment was observed
countries. By contrast, the decline in credit growth
in the Baltic States and mainly stemmed from
was more contained in countries where credit falling investment in the previously booming
growth had been more subdued and which had construction sector, which accounts for half of
relied more on domestic sources of funding before
total investment in these countries. Moreover,
the crisis (see Chart 5). For instance, total credit cross-country differences in the impact on
growth has declined on average by more than
35 percentage points in the Baltic States and 2 After September 2008 the cost of ﬁ nancing for non-ﬁ nancial
Romania between the last quarter of 2008
corporations and households increased strongly in most CEE
and the third quarter of 2009, compared with the
countries. Although interest rates declined somewhat in the
second half of 2009, reﬂ ecting in particular the lower cost of
average growth rates in the pre-crisis period. The
funding for banks following an expansionary monetary policy
reduction in credit growth was smaller for the
in the euro area and many CEE countries, they remained high
for loans in domestic currency. However, interest rates on loans
Czech Republic, Hungary and Poland, at between
denominated in euro declined in most countries compared with
5 percentage points and 14 percentage points.
their pre-crisis levels.
ECB
88 Monthly Bulletin
July 2010

A R T I C L E S
investment may also relate partly to the unwinding of excessive credit-driven private
The impact of
countries’ ﬁ nancing patterns and the degree to consumption growth before the crisis.
the financial crisis on
the central and eastern
which enterprises were dependent on external
European countries
ﬁ nancing. In the case of Poland, the fact that a The different paces and degrees to which the
large share of investment was typically ﬁ nanced labour markets responded to the crisis may also
internally may explain why investment was explain the cross-country differences in private
affected less severely.
consumption developments. Such differences in
labour market reactions resulted not only from
In all CEE countries, except the Czech Republic the extent of the economic downturn in the
and Poland, the sharp drop in domestic respective countries, but also from other factors,
demand was also driven by a steep decline such as the ﬂ exibility of the labour markets
in private consumption. The services (including the effects of employment protection
sector suffered particularly severely from legislation) and employment distribution
the decline in private consumption and across sectors. In some countries, in particular
contributed negatively to GDP growth, the Baltic States with their relatively ﬂ exible
except in Bulgaria and Poland (see Chart 7).
labour markets, enterprises reacted swiftly
Private consumption contracted very sharply in to the crisis by cutting wages and dismissing
the Baltic States and Romania. In the case of the workers, mainly in the construction sector which
Baltic States at least, this may largely reﬂ ect the employed a larger share of temporary workers.
impact of wealth effects – owing to the sharp In other countries, notably the Czech Republic,
decline in house and equity prices – and the Hungary, Poland and Romania, the employment
Chart 6 Expenditure contributions to real
Chart 7 Sectoral contributions to value
GDP growth
added growth
(average annual percentage growth rates Q4 2008-Q3 2009)
(average annual percentage growth rates Q4 2008-Q3 2009)
net exports
industry
inventories
construction
private consumption
agriculture
government consumption
services
investment
exports
15
15
4
4
10
10
0
0
5
5
0
0
-4
-4
-5
-5
-8
-8
-10
-10
-15
-15
-12
-12
-20
-20
-16
-16
-25
-25
-30
-30
-20
-20
BG
EE
LV
LT
CZ
HU
PL
RO
BG
EE
LV
LT
CZ
HU
PL
RO
Source: Eurostat.
Source: Eurostat.
Notes: Data are working day and seasonally adjusted except
Notes: Data are working day and seasonally adjusted except
for Bulgaria (no adjustment) and Romania (only seasonally
for Bulgaria (no adjustment) and Romania (only seasonally
adjusted). Countries to the left of the centre line have ﬁ xed
adjusted). Countries to the left of the centre line have ﬁ xed
exchange rate regimes or currency board arrangements. Those
exchange rate regimes or currency board arrangements. Those
on the right have more ﬂ exible regimes with the central banks
on the right have more ﬂ exible regimes with the central banks
pursuing inﬂ ation targeting strategies.
pursuing inﬂ ation targeting strategies.
ECB
Monthly Bulletin
July 2010
89

situation remained more robust, partly owing
Table 1 Change in total exports and the
to labour hoarding, with the adjustment taking
nominal and real effective exchange rate
place to a large extent through lower wage
growth and, in the industrial sector, through a
(percentage changes between Q3 2008 and Q3 2009)
downward adjustment of working hours, which
Total exports
NEER
REER-CPI
was partly facilitated by policy measures.
Bulgaria
-6.7 1.0
1.8
Estonia -9.6
1.8
0.6
Latvia -14.7
2.9
3.8
As a consequence of the sharp decline in
Lithuania -16.5
2.9
5.1
domestic demand, and given the high import
Czech Republic
-7.7
-4.7
-4.8
Hungary -6.9
-12.2
-8.0
content of some exports, imports declined Poland -9.0
-20.5
-17.0
sharply in most CEE countries until the third
Romania -3.7
-14.4
-10.1
quarter of 2009. In particular in Bulgaria, the
Source: ECB calculations.
Baltic States and Romania the fall in imports far
Notes: Total exports comprise goods and services and are
expressed in constant prices. NEER is the nominal effective
exceeded the notable decline in exports, leading
exchange rate, REER-CPI is the CPI-deﬂ ated real effective
exchange rate. A positive (negative) NEER or REER value
to a positive contribution of net exports to growth
implies an appreciation (depreciation) over the time period.
The ﬁ rst four countries have ﬁ xed exchange rate regimes or
over this period in the CEE countries. Only in the
currency board arrangements, while the last four countries have
Czech Republic did net exports make a negative
more ﬂ exible regimes with the central banks pursuing inﬂ ation
targeting strategies.
contribution to growth (see Chart 6).
CROSS-COUNTRY DIFFERENCES IN EXPOSURE
depreciation may have helped countries with
TO THE COLLAPSE IN FOREIGN DEMAND
ﬂ exible exchange rate regimes to contain the
decline in their exports.
Foreign demand for all CEE countries’ exports
slumped in the wake of the global ﬁ nancial Furthermore, cross-country differences in
and economic crisis. Given the high degree sectoral compositions also seem to explain
of openness of most CEE countries, the trade part of the differing export performances.
channel has been important in explaining the For a number of CEE countries, the lower
impact of the crisis on growth. While all CEE external demand for intermediate and capital
countries recorded a sharp decline in exports goods largely affected their exports of cars and
between the third quarter of 2008 and the third automotive parts. One of the main characteristics
quarter of 2009, the magnitude of the decline of the car industry, which is relatively sizeable
exhibited notable cross-country differences and in the Czech Republic, Hungary, Poland and
varied between more than 16% in Lithuania and Romania, is its strong export orientation and, as
less than 4% in Romania (see Table 1).
a consequence, its signiﬁ cant contribution to the
export performance of producer countries. As
These cross-country differences in the impact a result of their highly cyclical nature, the car
on trade can be partly attributed to differences industry and the industries that supply it have
in exchange rate regimes. In fact, countries been very responsive to the global business cycle.
which saw their nominal or real effective This, in turn, partly accounts for the observed
exchange rates weaken sharply between the cross-country differences in the impact of the
third quarter of 2008 and the third quarter of crisis and explains to some extent the negative
2009, such as Hungary, Poland and Romania, contribution to growth of the industrial sector
saw a relatively less sharp contraction in their in those countries with a sizeable car industry
exports. By contrast, the Baltic States, which (see Chart 7). Towards the end of 2009 this factor
have ﬁ xed exchange rate regimes, saw on was partly compensated by the positive spillover
average the steepest decline in exports among effects from various car scrappage schemes
the CEE countries. Thus, the rather sharp real introduced in other European countries.
ECB
90 Monthly Bulletin
July 2010

A R T I C L E S
Chart 8 Regional breakdown of
Chart 9 Current and capital account
The impact of
the contraction in foreign demand
balances
the financial crisis on
the central and eastern
(annual percentage changes in volumes, 2008)
(four-quarter averages to Q3 2008 and Q3 2009; as percentages
European countries
of GDP)
euro area
Q3 2008
CEE
Q3 2009
western Europe outside the euro area
CIS/SEE
North America
0
0
10
10
-2
-2
5
5
-4
-4
0
0
-6
-6
-5
-5
-8
-8
-10
-10
-10
-10
-12
-12
-15
-15
-14
-14
-20
-20
-16
-16
-25
-25
-18
-18
-30
-30
BG
EE
LV
LT
CZ
HU
PL
RO
BG
EE
LV
LT
CZ
HU
PL
RO
Sources: IMF and ECB calculations.
Source: ECB calculations.
Notes: Data are only available to 2008. The western Europe
Notes: Countries to the left of the centre line have ﬁ xed exchange
outside the euro area aggregate consists of Denmark,
rate regimes or currency board arrangements. Those on the right
Norway, Sweden, Switzerland and the United Kingdom. The
have more ﬂ exible regimes with the central banks pursuing
Commonwealth of Independent States (CIS) together with
inﬂ ation targeting strategies.
south-eastern Europe (SEE) comprises Albania, Azerbaijan,
Bosnia, Croatia, Kazakhstan, the former Yugoslav Republic of
Macedonia, Moldavia, Mongolia, Russia, Tajikistan, Turkey,
Turkmenistan, Ukraine and Uzbekistan. North America
comprises the United States of America and Canada. Countries
to the left of the centre line have ﬁ xed exchange rate regimes
or currency board arrangements. Those on the right have more
ﬂ exible regimes with the central banks pursuing inﬂ ation
targeting strategies.
The geographical concentration of exports also ADJUSTMENTS OF EXTERNAL BALANCES
seems to have played a role in the different trade
performances of the CEE countries (see Chart 8).
Mainly as a result of the intensiﬁ cation of the
The bulk of CEE countries’ exports (ranging ﬁ nancial crisis, the CEE countries experienced
from 80% to almost 90% of total exports) an unwinding of external imbalances. This can be
are destined for other European countries, a traced back to a substantial decline in domestic
phenomenon that, to a large extent, is related to demand pressures, leading to a sharp fall in
geographical proximity and the progress made imports, which has more than offset the foreign
in regional economic integration. However, demand-related contraction in exports. As a
some cross-country differences prevail. consequence, the current and capital account
The euro area tends to be the most important deﬁ
cits narrowed substantially in all CEE
export destination for Bulgaria, the Czech countries except the Czech Republic between
Republic, Hungary, Poland and Romania. the third quarter of 2008 and the third quarter of
By contrast, the Baltic States trade heavily 2009. At the same time, in the Baltic States the
with the CEE countries – primarily other Baltic combined current and capital account balances
States and Poland – and with the countries in have even turned into surpluses (see Chart 9).
the Commonwealth of Independent States and
south-eastern Europe. In particular, the strong In addition, there have been some notable shifts
linkages among the Baltic States may explain in the structure of external ﬁ nancing ﬂ ows
the large negative contribution of the CEE (see Chart 10). Since the fourth quarter of 2008
region to the collapse in foreign demand in these
the Baltic States, Bulgaria and Romania in
countries.
particular have recorded strong net outﬂ ows in
ECB
Monthly Bulletin
July 2010
91

The change in the composition of current
Chart 10 Changes in external financing
between Q3 2008 and Q3 2009
account ﬁ nancing appears to have had an impact
on the magnitude of overall current and capital
(percentages of GDP)
account adjustments across countries during
direct investment
the ﬁ nancial crisis. In particular, countries such
portfolio investment
other investment
as the Baltic States which had a large share of
reserve assets
“other investment” inﬂ ows prior to the crisis
combined current and capital account balance
experienced a very sharp contraction in their
30
30
current and capital account deﬁ cits.
20
20
10
10
0
0
3
CROSS-COUNTRY DIFFERENCES IN THE POLICY
-10
-10
RESPONSE TO THE CRISIS
-20
-20
-30
-30
FISCAL POLICY
-40
-40
BG
EE
LV
LT
CZ
HU
PL
RO
Fiscal responses to the crisis differed notably
Source: ECB calculations.
Notes: The data relate to four quarter averages to Q3 2008 and
across countries, thereby possibly also
Q3 2009. Countries to the left of the centre line have ﬁ xed
contributing to the cross-country differences in
exchange rate regimes or currency board arrangements. Those
on the right have more ﬂ exible regimes with the central banks
the impact of the crisis. The responses reﬂ ected
pursuing inﬂ ation targeting strategies.
the need to balance increasing concerns regarding
the sustainability of public ﬁ nances and other
“other investment”, which used to be the prime macroeconomic imbalances with the desire to let
source of ﬁ nancing before the global ﬁ nancial automatic stabilisers operate or even implement
and economic crisis in some of the countries. ﬁ scal stimuli to mitigate the detrimental impact
The reversal of “other investment” ﬂ ows can of the crisis on economic activity.
partly be attributed to the reassessment of risks
by international ﬁ nancial institutions, the global In Latvia, Hungary and Romania, the
deleveraging process and the associated transfers
requirements of the IMF and EU ﬁ nancial
of funds by domestic commercial banks to support programmes imposed strict ﬁ scal
foreign banks, including their parent banks. At consolidation through wide-ranging revenue
the same time, foreign direct investment inﬂ ows and expenditure measures from 2009.
fell in most countries, although they continued to
These measures were targeted at reducing
cover a signiﬁ cant part of the combined current government expenditure by downsizing public
and capital account deﬁ cit. Generally, increases administration, lowering public wages, reducing
in reserve assets are recorded as outﬂ ows in the beneﬁ t entitlements (e.g. pensions) and reducing
balance of payments statistics. For this reason, capital spending. On the revenue side, measures
net outﬂ ows of reserve assets in Bulgaria, which included inter alia a widening of the tax base.
can be traced back to a change in the regulation
on reserve requirements by Българска Bulgaria, Estonia and Lithuania also
народна банка (Bulgarian National Bank),
implemented comprehensive ﬁ scal measures in
were recorded as a positive change in the 2009 aimed at containing the rapid budgetary
contribution to the ﬁ nancing of the current deterioration. In Estonia and Lithuania, measures
account deﬁ cit. In Hungary a negative change in comprised in particular cuts in main expenditure
the contribution to the ﬁ nancing of the current items other than social transfers as well as higher
account was related to the disbursements under taxes. Bulgaria, on the other hand, implemented
the country’s international ﬁ nancial support a number of measures in 2009 aimed at cutting
programme.
expenditure and raising tax revenue collection
ECB
92 Monthly Bulletin
July 2010

A R T I C L E S
Table 2 Recommendations under the excessive deficit procedures
The impact of
the financial crisis on
the central and eastern
European countries
Deadline
EU Council recommendation (extract)
Czech Republic
2013
Implement [..] measures in 2010; ensure an average annual ﬁ scal effort of 1% of GDP over [..] 2010-13
Latvia
2012
Ensure an average annual ﬁ scal effort of at least 2.75% of GDP over [..] 2010-12
Lithuania
2012
Implement [..] the corrective measures planned [..] for 2010 [..]; ensure an average annual ﬁ scal effort
of at least 2.25% of GDP over [..] 2010-12 [..]
Hungary
2011
Ensure at least a cumulative 0.5% of GDP ﬁ scal effort over 2010-11
Poland
2012
Ensure an average annual ﬁ scal consolidation effort of at least 1.25% of GDP starting in 2010 [..]
Romania
2012
Implement [..] measures in 2010 [..] and continue consolidation in 2011 and 2012; ensure an average
annual ﬁ scal effort of at least 1.75% of GDP over [..] 2010-12 [..]
Source: EU Council Opinions.
by improving value added tax and corporate excessive deﬁ cit, and hence their ﬁ scal response
income tax compliance, in order to maintain a to the crisis has also been determined by the
sufﬁ ciently large ﬁ scal reserve.
recommendations of the respective excessive
deﬁ cit procedures (see Table 2). In addition,
In contrast, in the Czech Republic and Poland, the European Commission has initiated an
ﬁ scal policy was not tightened in 2009 and excessive deﬁ cit procedure against Bulgaria, as
automatic stabilisers were given room to operate.
the country’s budget balance reached -3.9% of
In Poland the effect of automatic stabilisers was GDP in 2009.
partly offset by cuts in discretionary spending,
while some ﬁ
scal stimulus measures were Generally, an assessment of the appropriateness
implemented in the Czech Republic. In the case of the CEE countries’ ﬁ scal policy stance
of Poland, reductions in labour taxation that had during the crisis is particularly difﬁ cult in
already been approved ahead of the crisis acted view of the uncertainty surrounding the level
as a ﬁ scal stimulus. In the Czech Republic, ﬁ scal and growth rate of their potential output.
consolidation started in 2010 and consisted This complicates an evaluation of the structural
primarily of measures affecting revenues, such efforts underlying the ﬁ scal policy responses
as hikes in value added tax and excise taxes and to the economic downturn. According to the
some cuts in beneﬁ t entitlements.
European Commission, in 2010 only Bulgaria
and Estonia are projected to have a deﬁ cit
Overall, six of the eight CEE countries are subject
below the 3% of GDP reference value set
to an EU Council decision on the existence of an in the Stability and Growth Pact, while the
Table 3 Fiscal developments in the period 2008-11
(percentages of GDP)
Expenditure ratio
Budget balance
General government gross debt
change 1)
2010
2008-10
2008
2009
2010
2011
2008
2009
2010
2011
Bulgaria
39.7
2.3
1.8
-3.9
-2.8
-2.2
14.1
14.8
17.4
18.8
Czech Republic
47.0
4.1
-2.7
-5.9
-5.7
-5.7
30.0
35.4
39.8
43.5
Estonia
45.8
5.9
-2.7
-1.7
-2.4
-2.4
4.6
7.2
9.6
12.4
Latvia
44.8
6.2
-4.1
-9.0
-8.6
-9.9
19.5
36.1
48.5
57.3
Lithuania
42.5
5.1
-3.3
-8.9
-8.4
-8.5
15.6
29.3
38.6
45.4
Hungary
48.8
-0.4
-3.8
-4.0
-4.1
-4.0
72.9
78.3
78.9
77.8
Poland
46.0
2.7
-3.7
-7.1
-7.3
-7.0
47.2
51.0
53.9
59.3
Romania
39.9
2.3
-5.4
-8.3
-8.0
-7.4
13.3
23.7
30.5
35.8
Source: European Commission’s European economic spring forecast 2010.
1) Changes in the expenditure ratio are expressed in percentage points.
ECB
Monthly Bulletin
July 2010
93

Czech Republic, Latvia, Lithuania, Hungary,
Chart 11 Changes in policy rates and real
Poland and Romania are expected to continue
short-term interest rates
recording large budget deﬁ cits. In all CEE
countries, other than Hungary, the expenditure-
(percentage points)
to-GDP ratio is projected to rise signiﬁ cantly in
policy rates Sep. 2008-Sep. 2009
policy rates Sep. 2008-May 2010
2010, compared with its level in 2008. Hungary
real interest rates Sep. 2008-Sep. 2009
is projected to remain the only country with a
real interest rates Sep. 2008-May 2010
debt ratio above 60% of GDP in 2010, while
16
16
14
the debt-to-GDP ratios of Poland and Latvia
14
12
12
are projected to rise close to this level in 2011.
10
10
Latvia and Lithuania are also projected to record
8
8
substantial increases in their debt ratios in 2010,
6
6
rising to 48.5% of GDP and 38.6% of GDP
4
4
2
2
respectively (see Table 3).
0
0
-2
-2
MONETARY POLICY
-4
-4
-6
-6
The conduct of monetary policy – both in
-8
-8
BG
EE
LV
LT
CZ
HU
PL
RO
the run-up to the crisis and in response to the
Sources: ECB and Consensus Forecast.
crisis – differed across countries. This may have
Notes: Real interest rates are deﬁ ned as three-month money
market rates deﬂ ated by Consensus inﬂ ation forecasts for one
also contributed to cross-country differences
year ahead. Countries to the left of the centre line have ﬁ xed
in terms of the impact of the crisis. As noted
exchange rate regimes or currency board arrangements. Those
on the right have more ﬂ exible regimes with the central banks
above, in the countries where monetary pursuing inﬂ ation targeting strategies.
policy was not constrained by the pursuit of
an exchange rate target, the reduction in real
activity since the outbreak of the crisis has been of imbalances and the dependence on foreign
considerably smaller compared with countries ﬁ nancing was generally lower in the pre-crisis
with ﬁ xed exchange rates, such as Bulgaria and period, thereby limiting the susceptibility of the
the three Baltic States. This was partly because economies to a drying-up of external ﬁ nancing.
of the overheating of the economies with ﬁ xed At the same time, the inﬂ ation targets seem to
exchange rate regimes in the pre-crisis period, have served the countries relatively well as an
which was driven by strong credit growth anchor for inﬂ ation expectations. However,
fuelled by very low or even negative interest in some countries, such as Hungary and
rates. In addition, the countries with ﬁ xed Romania, the disinﬂ ation process was far from
exchange rate regimes had very limited scope complete in the pre-crisis period, hindered
for autonomous monetary policy responses notably by the imprudent conduct of ﬁ scal
to the crisis. On the contrary, following the policy in the past. Overall, the countries with
sharp decline in their inﬂ ation outlook as a inﬂ ation targets were able to engineer large cuts
result of the crisis, real short-term interest in policy rates in reaction to the crisis.
rates have even increased in these countries,
in particular Latvia and Lithuania, compared The pace and extent to which policy rates were
with their pre-crisis levels, despite the lowering cut after the intensiﬁ cation of the crisis differed
of policy rates by the ECB (see Chart 11).
across countries. In the Czech Republic and
This may have further contributed to the sharp Poland, policy rates were cut sharply shortly
contraction in their GDP growth.
after September 2008, and the pronounced
currency depreciation provided some further
In the countries pursuing inﬂ ation targeting support to the economy. In contrast, interest
strategies, namely the Czech Republic, rates were initially increased in Hungary and
Hungary, Poland and Romania, the build-up left unchanged in Romania, before being cut
ECB
94 Monthly Bulletin
July 2010

A R T I C L E S
signiﬁ cantly in the course of 2009 and early signiﬁ cant signs of overheating and the most
The impact of
2010. In the latter two countries, inﬂ ationary pronounced imbalances were more vulnerable
the financial crisis on
the central and eastern
pressures remained strong. In addition, to and generally affected more severely by the
European countries
exchange rate devaluations posed a major risk crisis. Moreover, the impact of the crisis differed
to ﬁ nancial stability, given the very high across countries with respect to both the fall in
exposure of the private sector to movements in domestic demand and exposure to the collapse
the exchange rate, as a sizeable share of in foreign demand. In fact, countries with a high
outstanding loans to the private sector was degree of openness, a ﬁ xed exchange rate regime
denominated in foreign currency (above 50%).3 and a geographical concentration of exports to
Following the increase in risk aversion on the other CEE countries and the Commonwealth of
part of international investors, the central banks Independent States were particularly exposed to
of Hungary and Romania had to consider the the crisis via the foreign demand channel.
risks associated with a further depreciation of
the exchange rate and subsequent inﬂ ationary Cross-country differences also derived from the
pressures, as well as the adverse impact on the different macroeconomic policies pursued across
balance sheets of companies and households. In countries before and after the crisis. It appears
addition, the ﬁ
scal situation in these two that the impact of the crisis was particularly
countries was particularly difﬁ cult, thereby pronounced in countries where monetary policy
hampering the ability of monetary policy to was constrained by an exchange rate target in its
react to the crisis.
response to both overheating pressures prior to
the crisis and the subsequent economic downturn.
At the same time, the effectiveness of monetary In the absence of sufﬁ ciently supportive
policy was seriously reduced in most CEE policies in other areas, such as ﬁ scal policy and
countries owing to the global ﬁ nancial crisis, regulatory reforms to ensure sustainable credit
with risk and liquidity premia on the interbank developments, this contributed to greater output
markets generally increasing signiﬁ cantly. The and inﬂ ation volatility in these countries. In some
extent to which the crisis impaired the monetary countries with inﬂ ation targets, a large share of
policy transmission mechanism seems to have foreign currency denominated debt limited the
varied across countries, reﬂ ecting the differences scope for easing monetary policy in response to
between their ﬁ nancial markets in terms of size the crisis, as exchange rate-related balance sheet
and liquidity. In view of the impaired transmission
effects gave rise to ﬁ nancial stability concerns.
mechanism, a number of central banks adopted Furthermore, in some countries, ﬁ scal policy
additional monetary policy measures in order was not sufﬁ ciently tight before the crisis,
to ease overall monetary conditions and avoid contributing to overheating pressures and ﬁ scal
a credit crunch. Some countries also addressed sustainability concerns. This also limited the
foreign currency liquidity constraints through the
scope for ﬁ scal policy to counter the impact of
establishment of swap facilities with domestic the crisis by, at a minimum, allowing automatic
ﬁ nancial institutions.
stabilisers to work.
Looking ahead, it is crucial for the CEE countries
4
CONCLUDING REMARKS AND OUTLOOK
to avoid the re-emergence of macroeconomic
imbalances in the future and to ensure a
There are manifold possible explanations for sustainable convergence process. Countries
the considerable differences in the impact need to commit to lasting policy adjustments
of the crisis across the CEE countries – and and strengthen the necessary counter-cyclical
also the varying policy responses to it. The
build-up of imbalances prior to the crisis seems 3 In Hungary, new regulatory measures came into force in March
to have played an important role in cross-
2010 to limit the country’s high exposure in terms of foreign
country differences. Countries with the most
currency loans to the private sector.
ECB
Monthly Bulletin
July 2010
95

policy tools so that they are in a position to
better cope with shocks in an environment
where macro-ﬁ nancial linkages seem to play an
increasingly prominent role. In particular, given
the virtual absence of autonomous monetary
policy in countries with tightly pegged exchange
rates, it is imperative that other policy areas
provide the economy with the wherewithal to
cope with shocks and to avoid the recurrence of
macroeconomic imbalances.
To allow for a more balanced growth pattern,
many countries need to shift resources from
the non-tradable sector to the tradable sector.
They must also avoid returning to a situation in
which the catching-up process is largely driven
by excessively strong, externally ﬁ nanced
credit growth and asset price increases. Policy
adjustments should be geared towards limiting
the countries’ vulnerabilities, including with
respect to foreign currency lending, while at
the same time further increasing their capacity
to deal with economic shocks, in particular as
regards their labour market ﬂ exibility.
With respect to ﬁ scal policy, it is important that
the CEE countries achieve and maintain sound
and sustainable ﬁ scal positions. For many of
the countries concerned, having a ﬁ scal surplus
is an appropriate objective to limit the risk of
boom-bust cycles in the future. Countries that
are subject to an excessive deﬁ cit procedure
must comply with their commitments in a
credible and timely manner. Additional mainly
expenditure-based consolidation measures are
also required in those countries that have yet to
attain their medium-term budgetary objectives.
Strong ﬁ scal frameworks should also support
ﬁ scal consolidation and limit slippages in public
expenditure, while helping to prevent a re-
emergence of macroeconomic imbalances. With
respect to monetary policy, it is crucial for the
CEE countries to achieve and maintain price
stability on a lasting basis. Once the temporary
disinﬂ ationary factors related to the economic
and ﬁ nancial crisis have abated, this will, in
particular, require an overall policy stance
which will prevent overheating pressures from
re-emerging.
ECB
96 Monthly Bulletin
July 2010

EURO AREA STATISTICS
ECB
Monthly Bulletin
July 2010 S 1

CONTENTS 1

EURO AREA OVERVIEW
Summary of economic indicators for the euro area
S 5
1
MONETARY POLICY STATISTICS
1.1 Consolidated ﬁ nancial statement of the Eurosystem
S 6
1.2 Key ECB interest rates
S 7
1.3 Eurosystem monetary policy operations allotted through tender procedures
S 8
1.4 Minimum reserve and liquidity statistics
S 9
2
MONEY, BANKING AND INVESTMENT FUNDS
2.1 Aggregated balance sheet of euro area MFIs
S 1 0
2.2 Consolidated balance sheet of euro area MFIs
S 1 1
2.3 Monetary statistics

S 1 2
2.4 MFI loans: breakdown

S 1 4
2.5 Deposits held with MFIs: breakdown
S 1 7
2.6 MFI holdings of securities: breakdown
S 2 0
2.7 Revaluation of selected MFI balance sheet items
S 2 1
2.8 Currency breakdown of selected MFI balance sheet items
S 2 2
2.9 Aggregated balance sheet of euro area investment funds
S 2 4
2.10 Securities held by investment funds broken down by issuer of securities
S 2 5
3
EURO AREA ACCOUNTS
3.1 Integrated economic and ﬁ nancial accounts by institutional sector
S 2 6
3.2 Euro area non-ﬁ nancial accounts
S 3 0
3.3 Households

S 3 2
3.4 Non-ﬁ nancial corporations

S 3 3
3.5 Insurance corporations and pension funds
S 3 4
4 FINANCIAL
MARKETS
4.1 Securities other than shares by original maturity, residency of the issuer and currency
S 3 5
4.2 Securities other than shares issued by euro area residents, by sector of the issuer and instrument type
S 3 6
4.3 Growth rates of securities other than shares issued by euro area residents
S 3 8
4.4 Quoted shares issued by euro area residents
S 4 0
4.5 MFI interest rates on euro-denominated deposits from and loans to euro area residents
S 4 2
4.6 Money market interest rates

S 4 4
4.7 Euro area yield curves

S 4 5
4.8 Stock market indices

S 4 6
5
PRICES, OUTPUT, DEMAND AND LABOUR MARKETS
5.1 HICP, other prices and costs

S 4 7
5.2 Output and demand

S 5 0
5.3 Labour markets

S 5 4
6 GOVERNMENT
FINANCE
6.1 Revenue, expenditure and deﬁ cit/surplus
S 5 6
6.2 Debt

S 5 7
1 For further information, please contact us at: statistics@ecb.europa.eu. See the ECB’s Statistical Data Warehouse in the “Statistics” section of the ECB’s website
(http://sdw.ecb.europa.eu) for longer runs and more detailed data.
ECB
Monthly Bulletin
July 2010 S 3

6.3 Change in debt

S 5 8
6.4 Quarterly revenue, expenditure and deﬁ cit/surplus
S 5 9
6.5 Quarterly debt and change in debt
S 6 0
7
EXTERNAL TRANSACTIONS AND POSITIONS
7.1 Summary balance of payments

S 6 1
7.2 Current and capital accounts
S 6 2
7.3 Financial account
S 6 4
7.4 Monetary presentation of the balance of payments
S 7 0
7.5 Trade in goods

S 7 1
8 EXCHANGE
RATES
8.1 Effective exchange rates

S 7 3
8.2 Bilateral exchange rates

S 7 4
9
DEVELOPMENTS OUTSIDE THE EURO AREA
9.1 In other EU Member States

S 7 5
9.2 In the United States and Japan

S 7 6

LIST OF CHARTS

S 7 7
TECHNICAL
NOTES

S 7 9
GENERAL
NOTES

S 8 5
Conventions used in the tables
“-”
data do not exist/data are not applicable
“.”
data are not yet available
“…”
nil or negligible
“billion” 109
(p) provisional
s.a. seasonally
adjusted
n.s.a. non-seasonally
adjusted
ECB
S 4 Monthly Bulletin
July 2010

EURO AREA OVERVIEW
Summary of economic indicators for the euro area
(annual percentage changes, unless otherwise indicated)
1. Monetary developments and interest rates 1)
M1 2)
M2 2)
M3 2), 3)
M3 2), 3)
MFI loans to
Securities other
3-month
10-year
3-month
euro area
than shares issued
interest rate
spot rate
moving average
residents
in euro by non-MFI
(EURIBOR;
(% per annum;
(centred)
excluding MFIs
corporations 2)
% per annum;
end of
and general
period
period) 4)
government 2)
averages)
1
2
3
4
5
6
7
8
2008
2.4
9.6
9.7
- 9.5
18.9
4.64
3.69

2009
9.5
4.8
3.3
- 1.6
24.1
1.22
3.76
2009 Q3
12.2
4.5
2.7
- 0.4
24.4
0.87
3.64
Q4
12.3
2.2
0.3
- -0.6
19.7
0.72
3.76
2010 Q1
11.3
1.7
-0.2
- -0.4
10.7
0.66
3.46

Q2
. . . - .
. 0.69
3.03
2010 Jan.
11.5
1.8
0.0
-0.2
-0.6
12.2
0.68
3.66
Feb.
11.0
1.6
-0.4
-0.2
-0.4
9.6
0.66
3.49
Mar.
10.8
1.6
-0.1
-0.2
-0.2
8.9
0.64
3.46
Apr.
10.7
1.3
-0.2
-0.2
0.1
7.5
0.64
3.40
May
10.3
1.4
-0.2
. 0.2
. 0.69
3.00

June
. . . . .
. 0.73
3.03
2. Prices, output, demand and labour markets
HICP 1)
Industrial
Hourly
Real GDP
Industrial
Capacity
Employment
Unemployment
producer
labour
production
utilisation in
(% of labour
prices
costs
excluding
manufacturing
force)
construction
(%)
1
2
3
4
5
6
7
8
2008
3.3
6.1
3.5
0.6
-1.7
81.8
0.7
7.5

2009
0.3
-5.1
2.7
-4.1
-15.1
71.1
-1.9
9.4
2009 Q4
0.4
-4.6
1.7
-2.1
-7.7
71.7
-2.0
9.8
2010 Q1
1.1
-0.2
2.1
0.6
4.6
73.9
-1.2
9.9

Q2
. . . . . . .
.
2010 Jan.
1.0
-1.0
- -
1.7
72.3
-
9.9
Feb.
0.9
-0.4
- -
4.1
- -
9.9
Mar.
1.4
0.9
- -
7.8
- -
10.0
Apr.
1.5
2.8
- -
9.5
75.5
-
10.0

May
1.6
3.1
- - . - -
10.0
June
1.4
. - - . - -
.
3. External statistics
(EUR billions, unless otherwise indicated)

Balance of payments (net transactions)
Reserve assets
Net
Gross Effective exchange rate of
USD/EUR

(end-of-period
international
external debt
the euro: EER-21 5) exchange
rate
Current and
Combined
positions)
investment (as a % of GDP)
(index: 1999 Q1 = 100)
capital
Goods
direct and
position
accounts
portfolio
(as a % of GDP)
Nominal
Real (CPI)
investment
1
2
3
4
5
6
7
8
9
2008
-144.0
-19.1
145.4
374.2
-17.6
118.2
110.5
110.1
1.4708

2009
-47.8
39.5
222.2
462.4
-16.4
116.6
111.7
110.6
1.3948
2009 Q3
-2.2
13.8
54.4
430.9
-17.7
116.1
112.1
110.9
1.4303
Q4
9.9
19.4
55.3
462.4
-16.4
116.6
113.8
112.2
1.4779
2010 Q1
-16.9
3.5
-36.2
498.7
. .
108.7
106.9
1.3829

Q2
. .
.
.
.
.
103.1
101.7
1.2708
2010 Jan.
-13.0
-7.4
-3.8
468.8
. .
110.8
108.9
1.4272
Feb.
-5.3
5.1
8.1
492.6
. .
108.0
106.1
1.3686
Mar.
1.4
5.7
-40.5
498.7
. .
107.4
105.7
1.3569
Apr.
-7.1
3.6
18.5
521.6
. .
106.1
104.5
1.3406

May
. .
.
569.7
.
.
102.8
101.4
1.2565
June
. .
.
.
.
.
100.7
99.2
1.2209
Sources: ECB, European Commission (Eurostat and Economic and Financial Affairs DG) and Reuters.
Note: For more information on the data, see the relevant tables later in this section.
1)
Data refer to the changing composition of the euro area. For further information, see the General Notes.
2)
Annual percentage changes for monthly data refer to the end of the month, whereas those for quarterly and yearly data refer to the annual change in the period average.
See the Technical Notes for details.
3)
M3 and its components exclude holdings by non-euro area residents of money market fund shares/units and debt securities with a maturity of up to two years.
4)
Based on AAA-rated euro area central government bond yield curves. For further information, see Section 4.7.
5)
For a definition of the trading partner groups and other information, please refer to the General Notes.
ECB
Monthly Bulletin
July 2010 S 5

1 MONETARY POLICY STATISTICS
1.1 Consolidated financial statement of the Eurosystem
(EUR millions)
1. Assets
11 June 2010
18 June 2010
25 June 2010
2 July 2010
Gold and gold receivables
286,691
286,691
286,690
352,092
Claims on non-euro area residents in foreign currency
213,657
213,718
212,992
232,639
Claims on euro area residents in foreign currency
28,591
27,875
28,287
31,344
Claims on non-euro area residents in euro
17,033
16,451
16,276
16,883
Lending to euro area credit institutions in euro
829,523
844,913
870,354
680,576
Main refinancing operations
122,039
126,672
151,512
162,912
Longer-term refinancing operations
707,076
718,199
718,236
405,927
Fine-tuning reverse operations
0
0
0
111,237
Structural reverse operations
0
0
0
0
Marginal lending facility
367
11
565
484
Credits related to margin calls
41
32
42
16
Other claims on euro area credit institutions in euro
40,451
39,365
42,231
43,771
Securities of euro area residents in euro
406,461
410,377
414,448
416,735
Securities held for monetary policy purposes
103,733
109,603
115,097
120,062
Other
securities
302,729
300,774
299,351
296,674
General government debt in euro
35,576
35,576
35,576
35,085
Other assets
249,141
249,774
247,391
240,685
Total assets
2,107,126
2,124,740
2,154,245
2,049,811
2. Liabilities
11 June 2010
18 June 2010
25 June 2010
2 July 2010
Banknotes in circulation
809,744
808,925
809,750
816,470
Liabilities to euro area credit institutions in euro
562,610
574,912
580,559
424,032
Current accounts (covering the minimum reserve system)
137,814
295,683
245,063
160,380
Deposit
facility
384,260
232,045
284,357
231,717
Fixed-term
deposits
40,500
47,000
51,000
31,866
Fine-tuning reverse operations
0
0
0
0
Deposits related to margin calls
36
184
138
68
Other liabilities to euro area credit institutions in euro
723
1,044
1,038
818
Debt certificates issued
0
0
0
0
Liabilities to other euro area residents in euro
130,605
139,563
163,543
123,841
Liabilities to non-euro area residents in euro
41,146
41,794
41,429
41,882
Liabilities to euro area residents in foreign currency
1,092
1,051
957
926
Liabilities to non-euro area residents in foreign currency
15,434
14,698
14,648
15,481
Counterpart of special drawing rights allocated by the IMF
53,033
53,033
53,033
56,711
Other liabilities
165,611
162,591
162,161
162,640
Revaluation accounts
249,205
249,205
249,205
328,818
Capital and reserves
77,922
77,922
77,922
78,191
Total liabilities
2,107,126
2,124,740
2,154,245
2,049,811
Source: ECB.
ECB
S Monthly Bulletin
6 July 2010

EURO AREA
STATISTICS
Monetary
policy
statistics
1.2 Key ECB interest rates
(levels in percentages per annum; changes in percentage points)

With effect from: 1)
Deposit facility
Main refinancing operations
Marginal lending facility

Fixed rate tenders
Variable rate tenders

Fixed rate
Minimum bid rate

Level
Change
Level
Level
Change
Level
Change
1
2
3
4
5
6
7
1999 1 Jan.
2.00
- 3.00
-
- 4.50
-
4 2)
2.75
0.75
3.00
- ...
3.25
-1.25
22
2.00
-0.75
3.00
- ...
4.50
1.25
9 Apr.
1.50
-0.50
2.50
- -0.50
3.50
-1.00
5 Nov.
2.00
0.50
3.00
- 0.50
4.00
0.50
2000 4 Feb.
2.25
0.25
3.25
- 0.25
4.25
0.25
17 Mar.
2.50
0.25
3.50
- 0.25
4.50
0.25
28 Apr.
2.75
0.25
3.75
- 0.25
4.75
0.25
9 June
3.25
0.50
4.25
- 0.50
5.25
0.50
28 3)
3.25
... - 4.25
...
5.25
...
1 Sep.
3.50
0.25
- 4.50
0.25
5.50
0.25
6 Oct.
3.75
0.25
- 4.75
0.25
5.75
0.25
2001 11 May
3.50
-0.25
- 4.50
-0.25
5.50
-0.25
31 Aug.
3.25
-0.25
- 4.25
-0.25
5.25
-0.25
18 Sep.
2.75
-0.50
- 3.75
-0.50
4.75
-0.50
9 Nov.
2.25
-0.50
- 3.25
-0.50
4.25
-0.50
2002 6 Dec.
1.75
-0.50
- 2.75
-0.50
3.75
-0.50
2003 7 Mar.
1.50
-0.25
- 2.50
-0.25
3.50
-0.25
6 June
1.00
-0.50
- 2.00
-0.50
3.00
-0.50
2005 6 Dec.
1.25
0.25
- 2.25
0.25
3.25
0.25
2006 8 Mar.
1.50
0.25
- 2.50
0.25
3.50
0.25
15 June
1.75
0.25
- 2.75
0.25
3.75
0.25
9 Aug.
2.00
0.25
- 3.00
0.25
4.00
0.25
11 Oct.
2.25
0.25
- 3.25
0.25
4.25
0.25
13 Dec.
2.50
0.25
- 3.50
0.25
4.50
0.25
2007 14 Mar.
2.75
0.25
- 3.75
0.25
4.75
0.25
13 June
3.00
0.25
- 4.00
0.25
5.00
0.25
2008 9 July
3.25
0.25
- 4.25
0.25
5.25
0.25
8 Oct.
2.75
-0.50
- -
-
4.75
-0.50
9 4)
3.25
0.50
- -
-
4.25
-0.50
15 5)
3.25
... 3.75
- -0.50
4.25
...
12 Nov.
2.75
-0.50
3.25
- -0.50
3.75
-0.50
10 Dec.
2.00
-0.75
2.50
- -0.75
3.00
-0.75
2009 21 Jan.
1.00
-1.00
2.00
- -0.50
3.00
...
11 Mar.
0.50
-0.50
1.50
- -0.50
2.50
-0.50
8 Apr.
0.25
-0.25
1.25
- -0.25
2.25
-0.25
13 May
0.25
... 1.00
- -0.25
1.75
-0.50

Source: ECB.
1)
From 1 January 1999 to 9 March 2004, the date refers to the deposit and marginal lending facilities. For main refinancing operations, changes in the rate are effective from the
first operation following the date indicated. The change on 18 September 2001 was effective on that same day. From 10 March 2004 onwards, the date refers both to the deposit
and marginal lending facilities and to the main refinancing operations (with changes effective from the first main refinancing operation following the Governing Council
decision), unless otherwise indicated.
2)
On 22 December 1998 the ECB announced that, as an exceptional measure between 4 and 21 January 1999, a narrow corridor of 50 basis points would be applied between the
interest rates for the marginal lending facility and the deposit facility, aimed at facilitating the transition to the new monetary regime by market participants.
3)
On 8 June 2000 the ECB announced that, starting from the operation to be settled on 28 June 2000, the main refinancing operations of the Eurosystem would be conducted as
variable rate tenders. The minimum bid rate refers to the minimum interest rate at which counterparties may place their bids.
4)
As of 9 October 2008 the ECB reduced the standing facilities corridor from 200 basis points to 100 basis points around the interest rate on the main refinancing operations.
The standing facilities corridor was restored to 200 basis points as of 21 January 2009.
5)
On 8 October 2008 the ECB announced that, starting from the operation to be settled on 15 October, the weekly main refinancing operations would be carried out through a
fixed rate tender procedure with full allotment at the interest rate on the main refinancing operations. This change overrode the previous decision (made on the same day)
to cut by 50 basis points the minimum bid rate on the main refinancing operations conducted as variable rate tenders.
ECB
Monthly Bulletin
July 2010 S 7

1.3 Eurosystem monetary policy operations allotted through tender procedures 1), 2)
(EUR millions; interest rates in percentages per annum)
1. Main and longer-term refinancing operations 3)

Date of
Bids
Number of
Allotment
Fixed rate tender
Variable rate tender
Running for
settlement
(amount)
participants
(amount)
procedures
procedures
(...) days
Fixed rate
Minimum
Marginal
Weighted
bid rate
rate 4)
average rate
1
2
3
4
5
6
7
8
Main refinancing operations
2010 10 Mar.
78,402
71
78,402
1.00
- - - 7
17
79,032
79
79,032
1.00
- - - 7
24
81,062
81
81,062
1.00
- - - 7
31
78,266
73
78,266
1.00
- - - 7
7 Apr.
71,535
67
71,535
1.00
- - - 7
14
70,577
68
70,577
1.00
- - - 7
21
70,228
67
70,228
1.00
- - - 7
28
75,624
66
75,624
1.00
- - - 7
5 May
90,317
76
90,317
1.00
- - - 7
12
99,570
81
99,570
1.00
- - - 7
19
104,752
81
104,752
1.00
- - - 7
26
106,014
83
106,014
1.00
- - - 7
2 June
117,727
86
117,727
1.00
- - - 7
9
122,039
96
122,039
1.00
- - - 7
16
126,672
101
126,672
1.00
- - - 7
23
151,511
114
151,511
1.00
- - - 7
30
162,912
157
162,912
1.00
- - - 7
7 July
229,070
151
229,070
1.00
- - - 7
Longer-term refinancing operations
2010 10 Feb.
2,757
14
2,757
1.00
- - -
28
25
10,205
23
10,205
1.00
- - -
91
10 Mar.
9,315
11
9,315
1.00
- - -
35
1 Apr.
2,015
11
2,015
1.00
- - -
91
1 5)
17,876
62
17,876
.
- - -
182
14
15,730
12
15,730
1.00
- - -
28
29 3)
4,846
24
4,846
- 1.00
1.00
1.15
91
12 May
20,480
18
20,480
1.00
- - -
35
13 5)
35,668
56
35,668
.
- - -
182
27
12,163
35
12,163
1.00
- - -
91
16 June
31,603
23
31,603
1.00
- - -
28
1 July
131,933
171
131,933
1.00
- - -
91
2. Other tender operations

Date of settlement
Type of
Bids
Number of
Allotment Fixed rate tender
Variable rate tender
Running
operation
(amount) participants
(amount)
procedures
procedures
for
(...) days
Fixed rate
Minimum
Maximum
Marginal
Weighted
bid rate
bid rate
rate 4) average rate
1
2
3
4
5
6
7
8
9
10
2010 19 Jan.
Collection of fixed-term deposits
259,013
188
258,907
-
-
1.00
0.80
0.75
1
9 Feb.
Collection of fixed-term deposits
270,783
187
270,566
-
-
1.00
0.80
0.76
1
9 Mar.
Collection of fixed-term deposits
295,461
193
294,486
-
-
1.00
0.80
0.76
1
13 Apr.
Collection of fixed-term deposits
292,470
186
292,295
-
-
1.00
0.80
0.76
1
11 May
Collection of fixed-term deposits
319,752
193
319,693
-
-
1.00
0.80
0.76
1
19
Collection of fixed-term deposits
162,744
223
16,500
-
-
1.00
0.29
0.28
7
26
Collection of fixed-term deposits
86,003
93
26,500
-
-
1.00
0.28
0.27
7
2 June
Collection of fixed-term deposits
73,576
68
35,000
-
-
1.00
0.28
0.28
7
9
Collection of fixed-term deposits
75,627
64
40,500
-
-
1.00
0.35
0.31
7
15
Collection of fixed-term deposits
363,775
174
363,475
-
-
1.00
0.80
0.77
1
16
Collection of fixed-term deposits
71,078
66
47,000
-
-
1.00
0.30
0.28
7
23
Collection of fixed-term deposits
71,560
67
51,000
-
-
1.00
0.40
0.31
7
30
Collection of fixed-term deposits
31,866
45
31,866
-
-
1.00
1.00
0.54
7
1 July
Reverse transaction
111,237
78
111,237
1.00
-
-
-
-
6
7
Collection of fixed-term deposits
87,431
88
59,000
-
-
1.00
0.75
0.56
7

Source: ECB.
1)
The amounts shown may differ slightly from those in Section 1.1 owing to operations that have been allotted but not settled.
2)
With effect from April 2002, split tender operations (i.e. operations with a one-week maturity conducted as standard tender procedures in parallel with a main refinancing
operation) are classified as main refinancing operations. For split tender operations conducted before this month, see Table 2 in Section 1.3.
3)
On 8 June 2000 the ECB announced that, starting from the operation to be settled on 28 June 2000, the main refinancing operations of the Eurosystem would be conducted as
variable rate tender procedures. The minimum bid rate refers to the minimum interest rate at which counterparties may place their bids. On 8 October 2008 the ECB announced
that, starting from the operation to be settled on 15 October 2008, the weekly main refinancing operations would be carried out through a fixed rate tender procedure with full
allotment at the interest rate on the main refinancing operations. On 4 March 2010 the ECB decided to return to variable rate tender procedures in the regular three-month
longer-term refinancing operations, starting with the operation to be allotted on 28 April 2010 and settled on 29 April 2010.
4)
In liquidity-providing (absorbing) operations, the marginal rate refers to the lowest (highest) rate at which bids were accepted.
5)
In the final one-year longer-term refinancing operation, which was settled on 17 December 2009, as well as in the six-month longer-term refinancing operations settled on
1 April and 13 May 2010, the rate at which all bids were satisfied was indexed to the average minimum bid rate in the main refinancing operations over the life of the operation.
ECB
S Monthly Bulletin
8 July 2010

EURO AREA
STATISTICS
Monetary
policy
statistics
1.4 Minimum reserve and liquidity statistics
(EUR billions; period averages of daily positions, unless otherwise indicated; interest rates as percentages per annum)
1. Reserve base of credit institutions subject to reserve requirements

Reserve
Total Liabilities to which a 2% reserve coefficient is applied
Liabilities to which a 0% reserve coefficient is applied
base
as at: 1)
Overnight deposits and
Debt securities
Deposits with an agreed
Repos
Debt securities
deposits with an agreed maturity
issued with a maturity
maturity or notice period
issued with a maturity
or notice period of up to 2 years
of up to 2 years
of over 2 years
of over 2 years
1
2
3
4
5
6
2008
18,169.6
10,056.8
848.7
2,376.9
1,243.5
3,643.7
2009
18,318.2
9,808.5
760.4
2,475.7
1,170.1
4,103.5
2009 Dec.
18,318.2
9,808.5
760.4
2,475.7
1,170.1
4,103.5
2010 Jan.
18,454.5
9,829.1
766.1
2,465.6
1,225.0
4,168.7
Feb.
18,516.2
9,828.1
759.3
2,479.5
1,282.5
4,166.8
Mar.
18,587.9
9,807.3
782.8
2,506.7
1,283.5
4,207.6

Apr.
18,861.5
9,912.0
764.4
2,584.6
1,345.7
4,254.8
2. Reserve maintenance
Maintenance
Required
Credit institutions’
Excess
Deficiencies
Interest rate on
period
reserves
current accounts
reserves
minimum reserves
ending on:
1
2
3
4
5
2008
217.2
218.7
1.5
0.0
3.25

2009
210.2
211.4
1.2
0.0
1.00
2010 9 Feb.
209.5
210.9
1.4
0.0
1.00
9 Mar.
210.9
211.8
1.0
0.0
1.00
13 Apr.
211.4
212.5
1.2
0.0
1.00
11 May
211.2
212.4
1.2
0.0
1.00
15 June
211.3
212.5
1.3
0.0
1.00
13 July
213.0
.
.
.
.
3. Liquidity

Maintenance
Liquidity-providing factors
Liquidity-absorbing factors
Credit
Base
period

institutions’
money
ending on:
Monetary policy operations of the Eurosystem

current
accounts
Eurosystem’s
Main
Longer-term
Marginal
Other
Deposit
Other
Banknotes
Central
Other
net assets
refinancing
refinancing
lending
liquidity-
facility
liquidity-
in
government
factors
in gold
operations
operations
facility
providing
absorbing circulation
deposits
(net)
and foreign
operations 2)
operations 3)
with the
currency
Eurosystem
1
2
3
4
5
6
7
8
9
10
11
12
2008
580.5
337.3
457.2
2.7
0.0
200.9
4.9
731.1
107.8
114.3
218.7
1,150.7

2009
407.6
55.8
593.4
0.7
24.6
65.7
9.9
775.2
150.1
-130.2
211.4
1,052.3
2010 19 Jan.
413.0
60.6
648.4
0.4
28.4
147.0
8.1
796.8
119.8
-132.1
211.2
1,155.0
9 Feb.
425.6
59.7
662.2
0.2
33.5
168.3
13.3
783.6
122.6
-117.5
210.9
1,162.8
9 Mar.
426.9
80.5
641.1
0.9
38.0
186.4
10.5
784.6
113.2
-119.3
211.8
1,182.9
13 Apr.
439.8
77.7
650.5
0.4
43.6
200.7
8.4
792.9
113.6
-116.1
212.5
1,206.1
11 May
457.0
76.7
666.4
0.9
49.4
218.2
11.4
796.6
112.1
-100.3
212.4
1,227.2
15 June
462.4
110.0
706.7
0.3
86.9
288.8
34.1
806.2
123.1
-98.4
212.5
1,307.5
Source: ECB.
1) End of period.
2) Includes liquidity provided under the Eurosystem’s covered bond purchase programme and the Eurosystem’s securities markets programme.
3) Includes liquidity absorbed as a result of the Eurosystem’s foreign exchange swap operations.
For more information, please see: http://www.ecb.europa.eu/mopo/liq/html/index.en.html
ECB
Monthly Bulletin
July 2010 S 9

2 MONEY, BANKING AND INVESTMENT FUNDS
2.1 Aggregated balance sheet of euro area MFIs 1)
(EUR billions; outstanding amounts at end of period)
1. Assets

Total
Loans to euro area residents
Holdings of securities other than
Money
Holdings
External
Fixed Remaining

shares issued by euro area residents
market
of shares/
assets
assets
assets
fund other equity
Total
General
Other
MFIs
Total
General
Other
MFIs
shares/
issued by
government
euro area
government euro area
units 2)
euro area
residents
residents
residents
1
2
3
4
5
6
7
8
9
10
11
12
13
14
Eurosystem
2007
2,046.2
1,029.6
19.9
0.6
1,009.1
300.7
257.2
1.9
41.6
- 17.4
431.1
8.9
258.4
2008
2,982.9
1,803.0
20.6
0.6
1,781.8
362.3
319.6
2.4
40.3
- 14.4
484.7
8.6
309.9
2009 Q4
2,829.9
1,475.6
19.5
0.7
1,455.4
451.7
368.3
3.6
79.8
- 16.5
557.7
8.5
320.0
2010 Q1
2,880.9
1,476.1
19.6
0.7
1,455.9
472.4
376.1
4.1
92.2
- 16.6
583.0
8.4
324.4
2010 Jan.
2,823.5
1,464.9
19.5
0.7
1,444.8
451.7
364.3
3.8
83.6
- 16.2
563.2
8.4
319.1
Feb.
2,867.1
1,479.4
19.5
0.7
1,459.3
465.4
373.7
3.9
87.9
- 16.1
585.8
8.4
312.0
Mar.
2,880.9
1,476.1
19.6
0.7
1,455.9
472.4
376.1
4.1
92.2
- 16.6
583.0
8.4
324.4
Apr.
2,946.5
1,511.9
19.0
0.7
1,492.3
478.9
377.6
4.5
96.8
- 16.4
609.9
8.4
321.0

May (p)
3,259.2
1,732.5
19.0
0.7
1,712.9
516.5
408.6
4.8
103.1
- 15.9
665.5
8.5
320.4
MFIs excluding the Eurosystem
2007
29,500.2
16,893.0
954.5
10,144.3
5,794.2
3,950.6
1,197.1
1,013.2
1,740.3
93.5
1,293.8
4,878.9
205.7
2,184.7
2008
31,842.1
18,052.6
968.4
10,772.1
6,312.0
4,630.0
1,245.9
1,406.8
1,977.4
98.7
1,196.1
4,754.3
211.4
2,898.9
2009 Q4
31,153.8
17,703.7
1,002.3
10,780.3
5,921.1
5,061.5
1,483.9
1,496.8
2,080.8
85.1
1,234.9
4,258.1
220.4
2,590.2
2010 Q1
31,566.8
17,742.3
1,033.0
10,795.4
5,913.9
5,128.0
1,551.6
1,482.1
2,094.2
77.7
1,227.6
4,421.9
218.0
2,751.3
2010 Jan.
31,408.1
17,723.1
1,013.9
10,770.2
5,939.0
5,077.0
1,496.5
1,493.2
2,087.4
86.9
1,250.2
4,383.5
219.7
2,667.6
Feb.
31,525.0
17,712.6
1,009.1
10,773.5
5,930.0
5,094.9
1,523.7
1,497.4
2,073.7
85.6
1,232.7
4,432.0
218.2
2,749.0
Mar.
31,566.8
17,742.3
1,033.0
10,795.4
5,913.9
5,128.0
1,551.6
1,482.1
2,094.2
77.7
1,227.6
4,421.9
218.0
2,751.3
Apr.
31,977.9
17,895.9
1,037.5
10,816.9
6,041.5
5,131.6
1,561.3
1,490.0
2,080.3
76.6
1,270.6
4,517.2
218.0
2,868.1

May (p) 32,707.6
18,178.6
1,050.4
10,859.5
6,268.7
5,103.6
1,563.3
1,474.8
2,065.5
74.7
1,254.6
4,663.4
218.7
3,214.0
2. Liabilities

Total
Currency
Deposits of euro area residents
Money
Debt
Capital
External Remaining
in
market
securities
and
liabilities
liabilities
circulation
Total
Central
Other general
MFIs
fund
issued 4)
reserves
government
government/
shares/
other euro
units 3)
area residents
1
2
3
4
5
6
7
8
9
10
11
Eurosystem
2007
2,046.2
697.0
739.1
23.9
19.1
696.2
- 0.1
238.0
113.9
258.1
2008
2,982.9
784.7
1,240.7
68.8
16.6
1,155.2
- 0.1
273.8
377.8
305.9
2009 Q4
2,829.9
829.3
1,185.7
102.6
22.6
1,060.5
- 0.1
320.9
140.2
353.7
2010 Q1
2,880.9
819.9
1,222.8
101.2
22.0
1,099.6
- 0.1
353.0
135.4
349.6
2010 Jan.
2,823.5
806.2
1,204.1
116.3
23.5
1,064.2
- 0.1
328.4
133.5
351.3
Feb.
2,867.1
807.0
1,225.9
107.0
23.6
1,095.2
- 0.1
344.7
138.1
351.4
Mar.
2,880.9
819.9
1,222.8
101.2
22.0
1,099.6
- 0.1
353.0
135.4
349.6
Apr.
2,946.5
821.1
1,264.2
87.8
22.0
1,154.4
- 0.1
369.2
140.1
351.8

May (p)
3,259.2
828.4
1,511.6
128.8
23.3
1,359.5
- 0.1
407.0
155.3
356.9
MFIs excluding the Eurosystem
2007
29,500.2
- 15,141.9
126.9
8,927.5
6,087.5
754.1
4,630.9
1,683.6
4,538.6
2,751.1
2008
31,842.1
- 16,740.2
191.0
9,690.4
6,858.8
824.8
4,848.4
1,767.6
4,404.3
3,256.9
2009 Q4
31,153.8
- 16,465.8
144.2
10,034.6
6,287.1
732.3
4,919.1
1,921.0
4,099.8
3,015.8
2010 Q1
31,566.8
- 16,419.7
166.3
10,024.3
6,229.1
705.8
5,013.0
1,928.1
4,290.0
3,210.3
2010 Jan.
31,408.1
- 16,461.2
161.1
10,009.6
6,290.5
738.8
4,975.7
1,920.4
4,227.0
3,084.9
Feb.
31,525.0
- 16,460.3
166.5
10,012.0
6,281.8
729.4
4,961.0
1,916.9
4,285.4
3,172.0
Mar.
31,566.8
- 16,419.7
166.3
10,024.3
6,229.1
705.8
5,013.0
1,928.1
4,290.0
3,210.3
Apr.
31,977.9
- 16,591.5
159.7
10,111.5
6,320.2
710.6
5,018.7
1,931.7
4,409.4
3,316.1

May (p)
32,707.6
- 16,865.4
155.2
10,136.6
6,573.5
694.1
5,028.2
1,939.1
4,562.4
3,618.4
Source: ECB.
1)
Data refer to the changing composition of the euro area. For further information, see the General Notes.
2)
Amounts issued by euro area residents. Amounts issued by non-euro area residents are included in external assets.
3)
Amounts held by euro area residents.
4)
Amounts issued with a maturity of up to two years and held by non-euro area residents are included in external liabilities.
ECB
S Monthly Bulletin
10 July 2010

EURO AREA
STATISTICS
Money,
banking
and
investment
funds
2.2 Consolidated balance sheet of euro area MFIs 1)
(EUR billions; outstanding amounts at end of period; transactions during period)
1. Assets

Total
Loans to euro area residents
Holdings of securities other than shares
Holdings
External
Fixed
Remaining

issued by euro area residents
of shares/
assets
assets
assets
other equity
Total
General
Other
Total
General
Other
issued by
government
euro area
government
euro area other euro area
residents
residents
residents
1
2
3
4
5
6
7
8
9
10
11
Outstanding amounts
2007
22,380.4
11,119.4
974.4
10,144.9
2,469.4
1,454.3
1,015.1
882.2
5,310.0
214.6
2,384.7
2008
24,126.7
11,761.8
989.0
10,772.8
2,974.7
1,565.5
1,409.2
784.2
5,239.0
220.0
3,147.1
2009 Q4
23,862.6
11,802.7
1,021.7
10,781.0
3,352.5
1,852.2
1,500.3
811.8
4,815.8
228.9
2,851.0
2010 Q1
24,312.0
11,848.7
1,052.6
10,796.0
3,413.9
1,927.7
1,486.2
793.6
5,004.9
226.4
3,024.5
2010 Jan.
24,090.2
11,804.2
1,033.3
10,770.9
3,357.7
1,860.7
1,497.0
815.6
4,946.7
228.1
2,937.7
Feb.
24,260.7
11,802.7
1,028.5
10,774.2
3,398.7
1,897.4
1,501.2
801.4
5,017.8
226.6
3,013.6
Mar.
24,312.0
11,848.7
1,052.6
10,796.0
3,413.9
1,927.7
1,486.2
793.6
5,004.9
226.4
3,024.5
Apr.
24,626.9
11,874.0
1,056.5
10,817.6
3,433.4
1,938.9
1,494.5
825.3
5,127.1
226.4
3,140.7

May (p)
25,223.0
11,929.5
1,069.3
10,860.2
3,451.5
1,971.9
1,479.6
800.9
5,328.9
227.1
3,485.0
Transactions
2007
2,621.2
1,014.4
-10.0
1,024.4
289.0
-38.3
327.3
55.5
832.9
-1.2
431.1
2008
1,711.0
599.0
12.8
586.2
499.4
90.1
409.2
-56.0
-56.3
-3.0
728.9
2009 Q4
-124.1
-3.2
10.2
-13.4
-5.7
-11.4
5.7
9.2
-34.7
3.9
-93.5
2010 Q1
272.7
29.3
30.4
-1.1
52.2
71.7
-19.5
-13.0
53.9
-2.6
152.8
2010 Jan.
126.4
-18.1
11.3
-29.5
2.0
8.6
-6.6
4.9
62.5
-0.7
75.8
Feb.
118.5
-1.7
-4.9
3.3
34.4
31.9
2.5
-12.1
16.7
-1.8
83.0
Mar.
27.7
49.1
24.0
25.1
15.9
31.2
-15.3
-5.9
-25.3
0.0
-6.0
Apr.
271.9
31.4
3.6
27.8
20.6
13.0
7.6
34.9
69.7
0.0
115.3

May (p)
393.2
36.0
12.4
23.6
15.8
31.6
-15.7
-18.9
12.9
0.7
346.6
2. Liabilities
Total Currency in
Deposits of
Deposits of Money market
Debt
Capital
External
Remaining
Excess of
circulation
central
other general
fund shares/
securities
and
liabilities
liabilities
inter-MFI
government
government/
units 2)
issued 3)
reserves
liabilities
other euro area
over inter-MFI
residents
assets
1
2
3
4
5
6
7
8
9
10
Outstanding amounts
2007
22,380.4
638.6
150.8
8,946.6
660.4
2,849.1
1,492.7
4,652.5
3,009.2
-19.7
2008
24,126.7
722.9
259.8
9,707.1
725.7
2,830.7
1,615.2
4,782.1
3,562.7
-79.9
2009 Q4
23,862.6
770.1
246.8
10,057.2
646.9
2,758.5
1,802.3
4,240.0
3,369.6
-29.0
2010 Q1
24,312.0
768.7
267.4
10,046.3
628.1
2,826.6
1,830.6
4,425.4
3,559.9
-41.0
2010 Jan.
24,090.2
757.2
277.4
10,033.2
651.9
2,804.8
1,798.1
4,360.4
3,436.2
-29.1
Feb.
24,260.7
759.7
273.5
10,035.6
643.7
2,799.4
1,814.1
4,423.5
3,523.4
-12.2
Mar.
24,312.0
768.7
267.4
10,046.3
628.1
2,826.6
1,830.6
4,425.4
3,559.9
-41.0
Apr.
24,626.9
772.7
247.5
10,133.5
633.7
2,841.7
1,839.2
4,549.5
3,667.9
-59.1

May (p)
25,223.0
779.1
284.0
10,159.9
619.2
2,859.7
1,876.4
4,717.7
3,975.3
-48.5
Transactions
2007
2,621.2
45.8
-13.4
887.5
54.5
269.3
143.4
857.8
446.6
-70.4
2008
1,711.0
83.3
106.1
700.3
29.4
-32.0
139.0
93.1
616.2
-24.6
2009 Q4
-124.1
29.4
-48.6
103.1
-46.1
-22.8
52.8
-87.6
-139.1
34.8
2010 Q1
272.7
-1.3
20.7
-33.0
-20.1
42.5
-0.7
76.3
194.0
-5.7
2010 Jan.
126.4
-12.8
30.7
-32.3
4.7
30.3
-8.8
56.3
72.6
-14.2
Feb.
118.5
2.4
-3.9
-10.6
-8.2
-13.3
-1.0
28.9
101.7
22.5
Mar.
27.7
9.0
-6.1
9.8
-16.6
25.5
9.2
-8.8
19.7
-14.0
Apr.
271.9
4.0
-20.0
83.0
1.6
8.2
-3.4
94.8
116.1
-12.7

May (p)
393.2
6.4
36.4
6.5
-14.6
-21.4
15.1
16.7
333.4
14.6
Source: ECB.
1)
Data refer to the changing composition of the euro area. For further information, see the General Notes.
2)
Amounts held by euro area residents.
3)
Amounts issued with a maturity of up to two years and held by non-euro area residents are included in external liabilities.
ECB
Monthly Bulletin
July 2010 S 11

2.3 Monetary statistics 1)
(EUR billions and annual growth rates; seasonally adjusted; outstanding amounts and growth rates at end of period; transactions during period)
1. Monetary aggregates 2) and counterparts

M3
M3 Longer-term
Credit to
Credit to other euro area residents
Net

3-month
financial
general
external
M2
M3-M2
moving
liabilities government
Loans
Memo item: Loans
assets 3)
average
adjusted
M1
M2-M1
(centred)
for sales and
securitisation 4)
1
2
3
4
5
6
7
8
9
10
11
12
Outstanding amounts
2007
3,831.9
3,508.3
7,340.2
1,302.6
8,642.8
- 6,019.1
2,449.9
12,053.7
10,153.6
- 638.7
2008
3,980.2
4,033.1
8,013.3
1,372.0
9,385.4
- 6,285.9
2,576.2
12,965.8
10,777.2
- 437.2
2009 Q4
4,492.2
3,688.4
8,180.6
1,146.3
9,327.0
- 6,757.7
2,899.9
13,083.3
10,779.2
- 555.7
2010 Q1
4,567.8
3,652.6
8,220.4
1,103.0
9,323.5
- 6,895.6
2,979.4
13,090.5
10,801.2
- 591.1
2010 Feb.
4,561.1
3,659.6
8,220.7
1,091.1
9,311.8
- 6,872.5
2,929.6
13,118.3
10,795.6
- 572.7
Mar.
4,567.8
3,652.6
8,220.4
1,103.0
9,323.5
- 6,895.6
2,979.4
13,090.5
10,801.2
- 591.1
Apr.
4,649.8
3,613.8
8,263.6
1,121.3
9,384.8
- 6,947.4
2,983.4
13,096.7
10,819.5
- 604.9

May (p)
4,645.1
3,628.5
8,273.6
1,091.5
9,365.2
- 7,003.7
3,034.2
13,102.1
10,857.5
- 653.1
Transactions
2007
148.3
528.6
676.9
220.2
897.1
- 507.7
-51.0
1,403.5
1,024.8
1,115.4
-26.0
2008
130.2
484.0
614.1
47.8
661.9
- 253.1
103.1
927.9
581.9
737.8
-150.3
2009 Q4
89.6
-102.4
-12.8
-24.9
-37.7
- 52.5
17.1
-19.8
-4.5
-6.0
27.8
2010 Q1
71.7
-46.3
25.3
-43.5
-18.2
- 74.4
75.2
-9.3
5.8
-3.4
9.3
2010 Feb.
21.2
-11.7
9.5
-8.6
0.9
- 3.4
27.3
19.5
21.6
18.6
-17.6
Mar.
6.7
-7.5
-0.8
11.3
10.5
- 13.5
50.6
-23.0
8.8
6.8
16.7
Apr.
80.8
-41.1
39.8
14.3
54.1
- 31.9
5.6
14.9
24.6
26.9
-9.4

May (p)
-11.8
8.0
-3.7
-29.9
-33.7
- -11.2
48.8
-9.1
19.0
20.9
10.8
Growth rates
2007
4.0
17.8
10.2
20.1
11.6
11.9
9.3
-2.2
13.2
11.2
12.1
-26.0

2008
3.4
13.7
8.3
3.6
7.6
7.1
4.2
4.2
7.7
5.7
7.1
-150.3

2009 Q4
12.4
-9.1
1.6
-11.6
-0.3
-0.2
6.6
11.9
0.6
-0.2
0.2
122.9
2010 Q1
10.8
-8.0
1.6
-10.9
-0.1
-0.2
5.8
9.8
0.1
-0.2
-0.1
155.8
2010 Feb.
11.0
-8.1
1.6
-12.6
-0.4
-0.2
5.6
9.2
0.2
-0.4
-0.2
139.2
Mar.
10.8
-8.0
1.6
-10.9
-0.1
-0.2
5.8
9.8
0.1
-0.2
-0.1
155.8
Apr.
10.7
-8.6
1.3
-9.9
-0.2
-0.2
5.8
8.7
0.4
0.1
0.1
88.1

May (p)
10.3
-8.0
1.4
-10.7
-0.2
.
4.8
9.8
0.1
0.2
0.2
67.9
C1 Monetary aggregates 1)
C2 Counterparts 1)
(annual growth rates; seasonally adjusted)
(annual growth rates; seasonally adjusted)
longer-term financial liabilities
M1
credit to general government
M3
loans to other euro area residents
20
20
20
20
15
15
15
15
10
10
10
10
5
5
5
5
0
0
0
0
-5
-5
-5
-5
-10
-10
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Source: ECB.
1)
Data refer to the changing composition of the euro area. For further information, see the General Notes.
Monthly and other shorter-term growth rates for selected items are available at: http://www.ecb.europa.eu/stats/money/aggregates/aggr/html/index.en.html
2)
Monetary liabilities of MFIs and central government (post office, treasury, etc.) vis-à-vis non-MFI euro area residents excluding central government.
For definitions of M1, M2 and M3, see glossary.
3)
Values in the section ‘‘growth rates’’ are sums of the transactions during the 12 months ending in the period indicated.
4)
Adjustment for the derecognition of loans on the MFI balance sheet on account of their sale or securitisation.
ECB
S Monthly Bulletin
12 July 2010

EURO AREA
STATISTICS
Money,
banking
and
investment
funds
2.3 Monetary statistics 1)
(EUR billions and annual growth rates; seasonally adjusted; outstanding amounts and growth rates at end of period; transactions during period)
2. Components of monetary aggregates and longer-term financial liabilities
Currency
Overnight
Deposits
Deposits Repos
Money
Debt
Debt
Deposits
Deposits
Capital
in
deposits with an agreed
redeemable
market
securities with securities with
redeemable with an agreed
and
circulation
maturity of up
at notice of
fund
a maturity of a maturity of
at notice of
maturity of
reserves
to 2 years up to 3 months
shares/units
up to 2 years
over 2 years over 3 months
over 2 years
1
2
3
4
5
6
7
8
9
10
11
Outstanding amounts
2007
625.9
3,206.0
1,966.8
1,541.5 304.6
685.8
312.2
2,548.1
119.6
1,867.6
1,483.7
2008
710.6
3,269.7
2,464.5
1,568.6 350.3
754.9
266.9
2,576.0
121.6
1,984.4
1,603.9
2009 Q4
755.3
3,736.9
1,883.0
1,805.4 340.3
673.5
132.6
2,638.4
131.9
2,198.3
1,789.1
2010 Q1
775.5
3,792.4
1,816.8
1,835.8 343.0
625.3
134.8
2,693.5
132.2
2,241.1
1,828.8
2010 Feb.
764.8
3,796.3
1,830.1
1,829.5 323.6
641.7
125.8
2,681.0
131.2
2,245.2
1,815.0
Mar.
775.5
3,792.4
1,816.8
1,835.8 343.0
625.3
134.8
2,693.5
132.2
2,241.1
1,828.8
Apr.
769.2
3,880.6
1,773.1
1,840.6 359.2
624.2
137.9
2,708.3
131.2
2,260.5
1,847.4

May (p)
780.4
3,864.8
1,783.6
1,844.9 358.3
605.6
127.7
2,726.4
129.0
2,253.9
1,894.3
Transactions
2007
46.7
101.6
580.6
-52.0
41.0
58.5
120.6
149.3
9.8
207.3
141.3
2008
83.6
46.5
463.4
20.5
47.0
32.6
-31.9
1.2
0.7
114.6
136.7
2009 Q4
8.8
80.9
-147.6
45.2
12.4
-23.6
-13.7
4.4
-1.1
4.9
44.3
2010 Q1
20.2
51.5
-75.7
29.4
2.5
-49.4
3.4
28.0
0.3
35.4
10.7
2010 Feb.
4.0
17.3
-20.6
8.9
14.9
-16.8
-6.7
-15.7
-0.5
14.4
5.2
Mar.
10.7
-4.0
-13.8
6.3
19.4
-17.4
9.3
10.5
1.0
-4.5
6.4
Apr.
-6.2
87.1
-45.7
4.6
16.2
-5.1
3.2
7.7
0.3
17.4
6.6

May (p)
11.2
-22.9
4.2
3.9
-1.1
-18.6
-10.2
-21.2
-1.1
-13.5
24.6
Growth rates
2007
8.1
3.3
41.2
-3.3
15.5
9.2
62.1
6.3
9.6
12.4
10.8

2008
13.3
1.4
23.3
1.3
15.3
4.7
-10.6
0.1
0.5
6.1
9.3
2009 Q4
6.1
13.8
-24.4
15.1
-2.8
-1.8
-50.1
3.0
7.2
9.6
8.6

2010 Q1
6.8
11.7
-22.0
11.8
1.3
-11.8
-29.4
3.2
5.5
7.0
8.2
2010 Feb.
6.0
12.0
-22.5
12.7
-1.2
-9.4
-41.0
2.7
5.9
8.1
7.2
Mar.
6.8
11.7
-22.0
11.8
1.3
-11.8
-29.4
3.2
5.5
7.0
8.2
Apr.
5.5
11.8
-22.7
10.6
7.3
-11.8
-31.6
3.6
4.8
7.0
7.6

May (p)
6.8
11.0
-21.2
9.6
9.8
-13.9
-33.8
2.3
2.3
5.6
7.8
C3 Components of monetary aggregates 1)
C4 Components of longer-term financial liabilities 1)
(annual growth rates; seasonally adjusted)
(annual growth rates; seasonally adjusted)
currency in circulation
debt securities with a maturity of over 2 years
overnight deposits
deposits with an agreed maturity of over 2 years
deposits redeemable at notice of up to 3 months
capital and reserves
60
60
20
20
40
40
15
15
20
20
10
10
0
0
5
5
-20
-20
0
0
-40
-40
-5
-5
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Source: ECB.
1)
Data refer to the changing composition of the euro area. For further information, see the General Notes.
ECB
Monthly Bulletin
July 2010 S 13

2.4 MFI loans: breakdown 1), 2)
(EUR billions and annual growth rates; seasonally adjusted; outstanding amounts and growth rates at end of period; transactions during period)
1. Loans to financial intermediaries, non-financial corporations and households

Insurance
Other

corporations
financial
Non-financial corporations
Households 4)
and pension funds
intermediaries 3)

Total
Total
Total
Up to
Over 1
Over
Total
Consumer
Loans
Other
1 year
and up to
5 years
credit
for house
loans
5 years
purchase
1
2
3
4
5
6
7
8
9
10
Outstanding amounts
2007
107.5
876.6
4,384.6
1,282.9
859.8
2,241.9
4,784.9
616.7
3,421.0
747.3
2008
104.9
973.0
4,822.5
1,381.6
961.1
2,479.8
4,876.8
631.0
3,482.3
763.5
2009 Q4
90.0
1,059.9
4,685.9
1,185.8
936.9
2,563.2
4,943.4
630.3
3,542.4
770.6
2010 Q1
87.4
1,048.6
4,683.9
1,173.3
923.0
2,587.6
4,981.2
622.0
3,580.4
778.8
2010 Feb.
91.3
1,042.4
4,694.8
1,183.9
931.2
2,579.7
4,967.1
624.8
3,565.5
776.9
Mar.
87.4
1,048.6
4,683.9
1,173.3
923.0
2,587.6
4,981.2
622.0
3,580.4
778.8
Apr.
90.5
1,069.6
4,663.1
1,156.4
918.4
2,588.3
4,996.3
623.4
3,593.1
779.8

May (p)
90.2
1,071.8
4,688.3
1,168.1
917.1
2,603.1
5,007.3
623.0
3,604.0
780.3
Transactions
2007
16.7
175.2
554.9
145.6
155.7
253.6
278.0
31.4
226.5
20.0
2008
-3.7
87.2
418.7
86.8
119.8
212.0
79.8
10.4
52.3
17.1
2009 Q4
-3.4
10.3
-46.4
-45.4
-15.1
14.0
35.1
0.6
30.2
4.3
2010 Q1
-2.7
-32.4
1.7
-3.0
-10.9
15.6
39.2
-4.4
35.8
7.8
2010 Feb.
3.7
-6.6
12.8
-2.2
1.9
13.0
11.7
-1.7
10.4
3.0
Mar.
-3.9
3.6
-6.0
-0.1
-6.3
0.5
15.0
-0.9
13.9
1.9
Apr.
3.0
19.5
-14.2
-16.9
-1.1
3.8
16.3
0.1
12.7
3.5

May (p)
-0.5
-7.4
18.3
10.3
-2.4
10.4
8.6
-1.2
8.8
1.0
Growth rates
2007
18.2
24.7
14.5
12.8
22.0
12.8
6.2
5.4
7.1
2.7
2008
-3.5
10.0
9.5
6.7
13.9
9.4
1.7
1.7
1.5
2.3
2009 Q4
-13.0
3.6
-2.2
-13.1
-1.9
3.8
1.3
-0.1
1.5
1.6
2010 Q1
-11.3
0.1
-2.4
-10.6
-4.4
2.8
2.1
-1.0
2.6
2.8
2010 Feb.
-5.4
-0.6
-2.4
-12.0
-3.5
3.2
1.8
-0.8
2.1
2.7
Mar.
-11.3
0.1
-2.4
-10.6
-4.4
2.8
2.1
-1.0
2.6
2.8
Apr.
-7.4
2.3
-2.6
-10.9
-5.0
2.7
2.5
-0.4
2.9
3.1

May (p)
-7.8
0.5
-2.1
-9.8
-5.1
2.9
2.6
-0.4
3.1
2.9
C5 Loans to other financial intermediaries and non-financial
C6 Loans to households 2)
corporations 2) (annual growth rates; not seasonally adjusted)
(annual growth rates; not seasonally adjusted)
consumer credit
other financial intermediaries
loans for house purchase
non-financial corporations
other loans
35
35
14
14
30
30
12
12
25
25
10
10
20
20
8
8
15
15
6
6
10
10
4
4
5
5
2
2
0
0
0
0
-5
-5
-2
-2
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Source: ECB.
1)
MFI sector excluding the Eurosystem; sectoral classification is based on the ESA 95.
2)
Data refer to the changing composition of the euro area. For further information, see the General Notes.
3)
Including investment funds.
4)
Including non-profit institutions serving households.
ECB
S Monthly Bulletin
14 July 2010

EURO AREA
STATISTICS
Money,
banking
and
investment
funds
2.4 MFI loans: breakdown 1), 2)
(EUR billions and annual growth rates; not seasonally adjusted; outstanding amounts and growth rates at end of period; transactions during period)
2. Loans to financial intermediaries and non-financial corporations

Insurance corporations and pension funds
Other financial intermediaries 3)
Non-financial corporations
Total
Up to
Over 1
Over
Total
Up to
Over 1
Over
Total
Up to
Over 1
Over
1 year
and up to
5 years
1 year
and up to
5 years
1 year
and up to
5 years
5 years
5 years
5 years
1
2
3
4
5
6
7
8
9
10
11
12
Outstanding amounts
2008
93.7
69.3
6.2
18.2
962.5
555.4
169.0
238.1
4,828.2
1,377.4
961.3
2,489.5
2009 Q4
80.3
57.4
7.0
15.9
1,052.9
593.4
186.2
273.3
4,692.3
1,181.7
937.3
2,573.3

2010 Q1
87.1
65.4
5.8
15.9
1,056.2
594.5
184.8
276.9
4,680.5
1,170.0
924.2
2,586.2
2010 Mar.
87.1
65.4
5.8
15.9
1,056.2
594.5
184.8
276.9
4,680.5
1,170.0
924.2
2,586.2
Apr.
92.1
70.2
5.9
16.0
1,077.4
613.6
185.9
277.8
4,667.1
1,160.0
919.9
2,587.2

May (p)
93.8
71.6
5.7
16.6
1,084.4
617.6
186.3
280.4
4,687.1
1,164.8
919.0
2,603.2
Transactions
2008
-3.4
-3.1
-1.3
1.0
90.2
27.7
20.1
42.4
419.2
86.1
120.0
213.1
2009 Q4
-14.0
-14.2
-0.8
1.0
-9.9
-5.5
-5.2
0.8
-29.5
-46.1
-12.5
29.0

2010 Q1
6.6
7.9
-1.3
0.0
-17.8
-14.9
-5.9
3.0
-8.2
-2.2
-10.1
4.1
2010 Mar.
-1.2
-1.1
0.0
-0.1
17.7
19.2
-1.8
0.2
-4.6
0.4
-3.7
-1.2

Apr.
5.1
4.9
0.1
0.1
19.6
18.3
0.7
0.6
-6.6
-10.0
-0.7
4.1
May (p)
1.4
1.2
-0.3
0.5
-2.6
-2.4
-1.0
0.8
13.0
3.4
-2.0
11.6

Growth rates
2008
-3.5
-4.3
-17.8
6.1
10.5
5.5
13.5
22.0
9.5
6.7
13.9
9.4
2009 Q4
-13.1
-17.1
14.2
-4.8
4.1
4.3
4.4
3.1
-2.2
-13.1
-1.9
3.8
2010 Q1
-11.2
-12.5
-13.4
-3.2
-0.1
-0.7
-5.6
5.3
-2.3
-10.6
-4.4
2.8
2010 Mar.
-11.2
-12.5
-13.4
-3.2
-0.1
-0.7
-5.6
5.3
-2.3
-10.6
-4.4
2.8
Apr.
-7.5
-8.1
-4.6
-4.7
2.2
3.6
-5.4
4.2
-2.6
-10.9
-5.0
2.7

May (p)
-7.9
-8.7
-9.5
-2.4
0.5
0.5
-5.8
5.0
-2.1
-9.8
-5.1
2.9
3. Loans to households 4)

Total
Consumer credit
Loans for house purchase
Other loans
Total
Up to
Over 1
Over
Total
Up to
Over 1
Over
Total
Up to
Over 1
Over
1 year
and up to
5 years
1 year
and up to
5 years
1 year
and up to
5 years
5 years
5 years
5 years
1
2
3
4
5
6
7
8
9
10
11
12
13
Outstanding amounts
2008
4,887.8
633.0
138.8
196.2
298.0
3,490.4
17.2
67.5
3,405.7
764.4
155.0
90.4
519.0
2009 Q4
4,954.8
632.3
135.6
195.0
301.8
3,550.8
14.8
60.9
3,475.1
771.6
146.2
87.3
538.1

2010 Q1
4,971.6
619.8
130.5
191.1
298.2
3,574.8
14.8
60.7
3,499.3
777.1
147.0
85.5
544.6
2010 Mar.
4,971.6
619.8
130.5
191.1
298.2
3,574.8
14.8
60.7
3,499.3
777.1
147.0
85.5
544.6

Apr.
4,980.2
621.0
130.1
191.4
299.5
3,582.2
14.8
60.6
3,506.9
776.9
145.7
83.9
547.3
May (p)
4,994.3
620.8
131.2
190.0
299.6
3,595.3
14.9
60.4
3,520.0
778.2
144.8
83.9
549.4
Transactions
2008
80.2
10.4
1.0
-9.1
18.6
52.6
1.1
-3.8
55.3
17.1
2.5
-5.4
20.0
2009 Q4
40.0
0.7
3.0
-1.0
-1.3
34.5
-0.4
-1.6
36.5
4.8
-2.4
0.0
7.2

2010 Q1
18.2
-8.7
-3.5
-2.6
-2.6
21.7
0.0
0.1
21.7
5.2
0.3
-1.0
6.0
2010 Mar.
13.2
1.9
1.0
0.7
0.2
9.3
0.1
0.2
9.0
2.0
0.1
-0.1
2.0
Apr.
9.8
0.0
-0.4
-0.5
0.9
7.5
0.0
-0.1
7.6
2.3
-1.2
-0.5
3.9

May (p)
11.7
-1.0
0.3
-1.5
0.1
10.9
0.2
-0.3
11.0
1.8
-0.3
0.0
2.0

Growth rates
2008
1.7
1.7
0.7
-4.4
6.7
1.5
7.0
-5.2
1.7
2.3
1.7
-5.2
4.0
2009 Q4
1.3
-0.1
-0.9
-2.1
1.6
1.5
-15.3
-12.0
1.8
1.6
-5.1
-1.9
4.2
2010 Q1
2.1
-1.0
-1.7
-2.4
0.1
2.6
-10.4
-7.4
2.8
2.8
-2.2
-1.5
5.0
2010 Mar.
2.1
-1.0
-1.7
-2.4
0.1
2.6
-10.4
-7.4
2.8
2.8
-2.2
-1.5
5.0
Apr.
2.5
-0.4
-0.7
-1.8
0.8
2.9
-7.7
-7.4
3.1
3.1
-1.3
-2.4
5.2

May (p)
2.6
-0.4
0.3
-2.4
0.5
3.1
-6.7
-7.7
3.3
2.9
-1.0
-2.4
4.8
Source: ECB.
1)
MFI sector excluding the Eurosystem; sectoral classification is based on the ESA 95.
2)
Data refer to the changing composition of the euro area. For further information, see the General Notes.
3)
Including investment funds.
4)
Including non-profit institutions serving households.
ECB
Monthly Bulletin
July 2010 S 15

2.4 MFI loans: breakdown 1), 2)
(EUR billions and annual growth rates; not seasonally adjusted; outstanding amounts and growth rates at end of period; transactions during period)
4. Loans to government and non-euro area residents

General government
Non-euro area residents

Total
Central
Other general government
Total
Banks 3)
Non-banks
government
State
Local
Social
Total
General
Other
government
government
security
government
funds
1
2
3
4
5
6
7
8
9
10
Outstanding amounts
2008
968.4
227.1
210.1
509.0
22.2
3,247.8
2,282.0
965.8
57.8
908.1
2009
1,002.3
229.9
211.0
527.7
33.8
2,826.3
1,917.4
908.9
46.3
862.6
2009 Q2
999.0
249.4
206.5
514.5
28.6
2,949.2
1,999.9
949.3
57.1
892.2
Q3
994.7
235.9
209.7
518.3
30.7
2,808.1
1,894.1
914.0
47.7
866.2
Q4
1,002.3
229.9
211.0
527.7
33.8
2,826.3
1,917.4
908.9
46.3
862.6

2010 Q1 (p)
1,033.0
244.0
210.5
543.6
34.9
2,956.1
1,986.9
969.1
47.5
921.6
Transactions
2008
13.7
12.4
-8.1
16.5
-7.2
-59.3
-85.8
26.4
0.3
26.1
2009
36.0
2.8
0.9
20.8
11.5
-385.5
-346.8
-39.3
-1.5
-37.8
2009 Q2
28.0
16.9
0.9
2.6
7.6
-72.3
-78.9
6.9
-1.1
8.1
Q3
-4.2
-13.4
3.2
3.9
2.1
-75.1
-70.0
-5.1
0.8
-5.9
Q4
10.2
-6.2
1.3
12.0
3.1
-4.0
10.6
-15.4
-1.4
-14.0

2010 Q1 (p)
30.3
13.6
-0.4
16.0
1.2
55.8
23.5
32.1
0.0
32.1
Growth rates
2008
1.4
5.8
-3.7
3.3
-24.5
-1.8
-3.6
2.8
0.5
3.0

2009
3.7
1.2
0.5
4.1
52.0
-11.8
-15.1
-4.1
-3.1
-4.2
2009 Q2
2.6
12.8
-4.1
3.9
-31.9
-13.8
-16.5
-7.5
-7.8
-7.5
Q3
1.7
4.5
-0.2
4.4
-32.3
-18.2
-21.9
-9.4
-1.3
-9.9

Q4
3.7
1.2
0.5
4.1
52.0
-11.8
-15.1
-4.1
-3.1
-4.2
2010 Q1 (p)
6.6
4.7
2.4
6.8
66.2
-3.1
-5.5
2.0
-3.5
2.3
C7 Loans to government 2)
C8 Loans to non-euro area residents 2)
(annual growth rates; not seasonally adjusted)
(annual growth rates; not seasonally adjusted)
central government
non-resident banks
other general government
non-resident non-banks
15
15
40
40
10
10
30
30
5
5
20
20
0
0
10
10
-5
-5
0
0
-10
-10
-10
-10
-15
-15
-20
-20
-20
-20
-30
-30
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Source: ECB.
1)
MFI sector excluding the Eurosystem; sectoral classification is based on the ESA 95.
2)
Data refer to the changing composition of the euro area. For further information, see the General Notes.
3)
The term ‘‘banks’’ is used in this table to indicate institutions similar to MFIs which are resident outside the euro area.
ECB
S Monthly Bulletin
16 July 2010

EURO AREA
STATISTICS
Money,
banking
and
investment
funds
2.5 Deposits held with MFIs: breakdown 1), 2)
(EUR billions and annual growth rates; outstanding amounts and growth rates at end of period; transactions during period)
1. Deposits by financial intermediaries

Insurance corporations and pension funds
Other financial intermediaries 3)

Total Overnight With an agreed maturity of: Redeemable at notice of:
Repos
Total Overnight With an agreed maturity of: Redeemable at notice of:
Repos
Up to
Over 2
Up to
Over
Up to
Over
Up to
Over
2 years
years
3 months
3 months
2 years
2 years
3 months
3 months
1
2
3
4
5
6
7
8
9
10
11
12
13
14
Outstanding amounts
2007
689.5
70.8
69.6
526.4
0.8
1.1
20.8 1,525.0
311.8
345.5
708.1
12.2
0.3
147.1

2008
761.9
84.4
114.3
537.5
1.1
1.5
23.1 1,803.1
320.3
420.6
852.9
12.3
0.1
197.0

2009 Q4
738.3
84.2
87.0
543.3
2.2
1.4
20.2 1,873.1
313.4
335.3
957.6
15.9
0.0
250.9
2010 Q1
735.8
87.1
84.9
539.7
2.5
1.4
20.2 1,886.8
329.1
311.9
956.7
17.1
0.1
272.0
2010 Feb.
736.4
90.3
85.6
539.5
2.3
1.4
17.3 1,897.4
334.4
327.4
962.9
17.0
0.2
255.5
Mar.
735.8
87.1
84.9
539.7
2.5
1.4
20.2 1,886.8
329.1
311.9
956.7
17.1
0.1
272.0
Apr.
736.1
88.4
84.9
540.6
2.5
1.4
18.3 1,949.0
367.2
301.9
965.9
18.3
0.2
295.4

May (p)
732.3
91.3
87.2
536.4
2.4
0.3
14.8 1,952.2
368.6
299.4
966.7
12.4
0.2
304.9
Transactions
2007
31.3
0.8
10.4
24.7
-0.3
-0.3
-4.1
394.9
33.9
98.7
236.3
1.7
0.1
24.1

2008
69.4
12.4
42.8
12.3
-0.3
0.1
2.2
268.9
4.5
71.8
142.3
-0.3
-0.3
51.0
2009 Q4
-4.6
0.6
0.8
-7.3
0.3
0.0
1.1
-17.1
-1.9
-4.3
-9.8
1.4
-0.1
-2.4

2010 Q1
-3.8
2.7
-3.1
-3.7
0.3
0.0
0.0
-3.0
13.4
-30.2
-8.3
1.1
0.1
20.9
2010 Feb.
-7.2
-3.8
2.4
-0.7
0.0
0.0
-5.0
9.2
-8.8
-0.9
-2.9
-0.1
0.1
21.8
Mar.
-1.4
-3.2
-1.5
0.2
0.2
0.0
3.0
-12.0
-5.7
-16.2
-6.6
0.0
0.0
16.5

Apr.
0.2
1.3
-0.1
-0.2
0.0
1.1
-1.9
58.8
37.3
-11.6
8.4
1.2
0.0
23.4
May (p)
-5.8
2.5
2.0
-6.7
-0.1
0.0
-3.5
-5.2
-1.1
-4.1
-3.4
-6.0
0.1
9.2

Growth rates
2007
4.8
1.1
17.5
4.9
-25.3
- -16.4
34.5
12.0
39.7
49.5
16.4
- 19.1
2008
10.0
17.3
60.0
2.3
-23.4
- 10.5
17.6
1.4
20.9
20.0
-2.5
- 34.6
2009 Q4
-3.6
-1.1
-26.5
1.0
96.8
- -12.3
3.1
2.0
-22.0
10.0
30.0
- 27.4
2010 Q1
-3.5
-4.7
-16.4
-1.1
53.8
- -5.6
1.1
2.7
-15.2
3.0
18.1
- 15.9
2010 Feb.
-3.2
-3.1
-14.6
-0.8
64.7
- -18.9
3.1
2.1
-13.0
5.7
21.7
- 20.6
Mar.
-3.5
-4.7
-16.4
-1.1
53.8
- -5.6
1.1
2.7
-15.2
3.0
18.1
- 15.9
Apr.
-3.6
-2.1
-15.4
-1.8
42.2
- -12.1
2.8
11.3
-20.0
3.1
21.6
- 24.1

May (p)
-3.5
8.4
-12.7
-3.2
28.7
- -24.9
2.5
16.5
-20.1
0.8
-17.1
- 27.3
C9 Total deposits by sector 2)
C10 Total deposits and deposits included in M3
(annual growth rates)
by sector 2) (annual growth rates)
insurance corporations and pension funds (total)
insurance corporations and pension funds (total)
other financial intermediaries (total)
other financial intermediaries (total)
insurance corporations and pension funds (included in M3)4)
other financial intermediaries (included in M3)5)
40
40
40
40
30
30
30
30
20
20
20
20
10
10
10
10
0
0
0
0
-10
-10
-10
-10
-20
-20
2000
2002
2004
2006
2008
2004
2005
2006
2007
2008
2009
Source: ECB.
1)
MFI sector excluding the Eurosystem; sectoral classification is based on the ESA 95.
2)
Data refer to the changing composition of the euro area. For further information, see the General Notes.
3)
Includes investment funds.
4)
Covers deposits in columns 2, 3, 5 and 7.
5)
Covers deposits in columns 9, 10, 12 and 14.
ECB
Monthly Bulletin
July 2010 S 17

2.5 Deposits held with MFIs: breakdown 1), 2)
(EUR billions and annual growth rates; outstanding amounts and growth rates at end of period; transactions during period)
2. Deposits by non-financial corporations and households

Non-financial corporations
Households 3)

Total Overnight With an agreed maturity of: Redeemable at notice of:
Repos
Total Overnight With an agreed maturity of: Redeemable at notice of:
Repos
Up to
Over 2
Up to
Over
Up to
Over
Up to
Over
2 years
years
3 months
3 months
2 years
2 years
3 months
3 months
1
2
3
4
5
6
7
8
9
10
11
12
13
14
Outstanding amounts
2007
1,477.2
884.0
479.4
59.5
29.3
1.4
23.7 4,989.0
1,777.4
993.3
561.5
1,458.6
111.1
87.1

2008
1,502.8
883.4
502.2
64.4
27.9
1.3
23.7 5,368.6
1,813.3
1,350.0
517.9
1,490.2
113.6
83.7

2009 Q4
1,603.3
1,001.2
434.7
80.7
68.7
1.7
16.3 5,590.9
2,155.6
988.5
605.6
1,680.2
123.7
37.3
2010 Q1
1,576.5
982.4
423.8
82.9
72.9
1.8
12.6 5,593.7
2,157.8
925.0
631.6
1,721.5
121.7
36.1
2010 Feb. 1,534.7
954.1
414.8
81.7
70.7
1.8
11.7 5,611.7
2,176.5
935.8
625.0
1,715.9
121.6
37.0
Mar. 1,576.5
982.4
423.8
82.9
72.9
1.8
12.6 5,593.7
2,157.8
925.0
631.6
1,721.5
121.7
36.1
Apr. 1,588.0
995.5
417.4
86.7
73.7
1.9
12.8 5,608.3
2,184.0
908.1
636.1
1,726.3
119.8
33.9

May (p) 1,597.2
1,005.0
415.1
88.5
74.1
1.8
12.7 5,618.3
2,191.1
902.3
641.0
1,733.4
118.1
32.5
Transactions
2007
140.2
34.1
126.8
-8.1
-10.8
-0.7
-1.1
282.9
22.4
320.9
-45.4
-43.2
11.2
17.1

2008
7.8
-5.1
13.3
3.2
-3.4
-0.3
0.0
347.5
28.7
335.5
-43.1
28.1
1.7
-3.4
2009 Q4
51.7
49.4
-10.0
2.7
10.4
0.2
-1.1
90.8
102.5
-96.5
45.0
43.3
2.3
-5.8

2010 Q1
-28.5
-20.3
-11.3
2.5
4.2
0.1
-3.7
0.5
2.2
-64.6
25.8
40.4
-2.0
-1.2
2010 Feb.
-14.2
-11.0
-4.0
0.2
2.0
0.0
-1.4
-0.8
2.1
-18.7
9.5
6.9
-0.6
0.0
Mar.
43.0
28.7
9.9
1.3
2.2
0.1
0.9
-17.8
-18.6
-10.7
6.6
5.7
0.1
-0.9

Apr.
11.1
13.1
-6.7
3.7
0.8
0.0
0.2
14.3
26.0
-16.9
4.5
4.7
-1.8
-2.2
May (p)
3.0
6.6
-5.1
1.4
0.1
0.0
-0.1
7.1
5.8
-7.2
4.8
6.9
-1.8
-1.4

Growth rates
2007
10.4
4.0
35.1
-11.8
-26.3
-31.6
-4.4
6.1
1.3
47.7
-7.5
-3.3
11.2
24.4
2008
0.5
-0.6
2.8
5.4
-11.0
-16.2
0.0
6.9
1.6
33.2
-7.7
1.9
1.5
-3.9
2009 Q4
6.2
12.9
-13.9
23.1
146.6
28.3
-31.2
3.5
17.5
-27.3
16.4
12.8
7.5
-55.4
2010 Q1
6.9
12.7
-10.7
17.8
89.7
37.2
-29.4
2.7
13.6
-27.8
20.5
10.0
5.3
-41.2
2010 Feb.
5.1
11.3
-12.9
18.1
100.9
32.4
-45.1
3.1
15.6
-28.4
19.7
10.8
5.8
-47.1
Mar.
6.9
12.7
-10.7
17.8
89.7
37.2
-29.4
2.7
13.6
-27.8
20.5
10.0
5.3
-41.2
Apr.
6.6
13.8
-12.8
21.0
68.0
33.7
-35.1
2.3
11.7
-26.8
20.5
9.0
3.5
-40.3

May (p)
5.8
12.3
-12.3
22.2
56.7
30.3
-37.5
2.1
10.3
-25.9
20.5
8.7
0.7
-40.0
C11 Total deposits by sector 2)
C12 Total deposits and deposits included in M3
(annual growth rates)
by sector 2) (annual growth rates)
non-financial corporations (total)
non-financial corporations (total)
households (total)
households (total)
non-financial corporations (included in M3)4)
households (included in M3)5)
14
14
20
20
12
12
15
15
10
10
8
8
10
10
6
6
4
4
5
5
2
2
0
0
0
0
-2
-2
-5
-5
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
2004
2005
2006
2007
2008
2009
Source: ECB.
1)
MFI sector excluding the Eurosystem; sectoral classification is based on the ESA 95.
2)
Data refer to the changing composition of the euro area. For further information, see the General Notes.
3)
Including non-profit institutions serving households.
4)
Covers deposits in columns 2, 3, 5 and 7.
5)
Covers deposits in columns 9, 10, 12 and 14.
ECB
S Monthly Bulletin
18 July 2010

2.6 MFI holdings of securities: breakdown 1), 2)
(EUR billions and annual growth rates; outstanding amounts and growth rates at end of period; transactions during period)

Securities other than shares
Shares and other equity

Total
MFIs
General
Other euro
Non-euro area
Total
MFIs
Non-MFIs
Non-euro area

government
area residents
residents
residents
Euro
Non-euro
Euro
Non-euro
Euro
Non-euro
1
2
3
4
5
6
7
8
9
10
11
12
Outstanding amounts
2007
5,185.3
1,656.4
84.0
1,180.5
16.6
979.9
33.3
1,234.7
1,636.5
424.5
869.3
342.7
2008
5,857.6
1,884.9
92.4
1,226.6
19.3
1,355.6
51.2
1,227.5
1,473.3
421.7
774.4
277.2
2009 Q4
6,209.6
1,971.7
109.2
1,467.9
16.1
1,457.3
39.4
1,148.0
1,515.9
434.7
800.2
281.0
2010 Q1
6,302.8
1,980.3
114.0
1,534.9
16.7
1,442.1
40.0
1,174.8
1,515.6
445.7
781.9
288.0
2010 Feb.
6,275.5
1,964.1
109.6
1,507.4
16.3
1,456.8
40.6
1,180.7
1,516.0
442.6
790.1
283.2
Mar.
6,302.8
1,980.3
114.0
1,534.9
16.7
1,442.1
40.0
1,174.8
1,515.6
445.7
781.9
288.0
Apr.
6,309.9
1,966.2
114.1
1,544.2
17.0
1,449.7
40.3
1,178.3
1,560.1
456.8
813.8
289.5

May (p)
6,273.7
1,955.2
110.3
1,545.2
18.2
1,445.6
29.2
1,170.1
1,543.0
464.8
789.8
288.4
Transactions
2007
592.4
136.0
18.1
-86.2
1.5
318.3
9.5
195.2
147.8
51.3
55.4
41.0
2008
696.1
214.4
5.9
38.3
1.9
389.7
19.0
26.9
-84.8
22.4
-56.5
-50.7
2009 Q4
-97.7
-44.5
4.4
-17.8
-2.2
12.7
-7.3
-43.1
14.8
1.7
8.9
4.2
2010 Q1
47.4
7.1
-0.3
65.2
-0.3
-17.9
-2.1
-4.3
8.8
12.5
-13.0
9.3
2010 Feb.
9.0
-14.3
-2.7
26.4
-3.1
3.8
-1.3
0.3
-15.0
-4.0
-12.1
1.1
Mar.
23.8
16.4
3.7
28.8
0.4
-14.4
-1.2
-9.9
5.0
3.7
-5.9
7.2
Apr.
-3.3
-12.8
-1.4
9.9
0.1
7.5
-0.2
-6.3
48.7
12.7
34.9
1.0

May (p)
-85.2
-9.7
-10.7
0.5
-0.3
-2.3
-13.7
-49.0
-8.6
10.1
-18.9
0.1
Growth rates
2007
12.7
8.7
25.4
-6.8
10.7
50.2
33.4
17.7
10.0
13.7
6.9
13.9

2008
13.4
12.8
8.1
3.2
9.9
39.9
57.2
2.2
-5.3
5.3
-6.7
-15.3
2009 Q4
6.0
4.4
17.5
18.7
-16.0
7.6
-23.2
-5.3
2.9
7.0
1.5
0.7

2010 Q1
2.3
-0.4
7.8
12.0
-19.1
3.0
-23.2
-4.1
3.4
7.3
0.6
5.5
2010 Feb.
2.8
-0.7
5.4
13.5
-18.5
5.8
-24.8
-5.1
2.4
6.8
0.4
1.3
Mar.
2.3
-0.4
7.8
12.0
-19.1
3.0
-23.2
-4.1
3.4
7.3
0.6
5.5

Apr.
1.2
-2.6
9.7
11.3
-19.1
1.7
-23.1
-4.0
4.7
8.8
2.3
5.2
May (p)
-1.2
-4.3
-6.8
9.6
-17.2
0.6
-47.7
-8.2
4.0
10.0
0.3
5.4
C14 MFI holdings of securities 2)
(annual growth rates)
securities other than shares
shares and other equity
30
30
25
25
20
20
15
15
10
10
5
5
0
0
-5
-5
-10
-10
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
Source: ECB.
1)
MFI sector excluding the Eurosystem; sectoral classification is based on the ESA 95.
2)
Data refer to the changing composition of the euro area. For further information, see the General Notes.
ECB
S Monthly Bulletin
20 July 2010

EURO AREA
STATISTICS
Money,
banking
and
investment
funds
2.7 Revaluation of selected MFI balance sheet items 1), 2)
(EUR billions)
1. Write-offs/write-downs of loans to households 3)

Consumer credit
Lending for house purchase
Other lending
Total
Up to
Over 1
Over
Total
Up to
Over 1
Over
Total
Up to
Over 1
Over
1 year
and up to
5 years
1 year
and up to
5 years
1 year
and up to
5 years
5 years
5 years
5 years
1
2
3
4
5
6
7
8
9
10
11
12
2007
-4.2
-1.2
-1.4
-1.6
-2.7
-0.2
-0.2
-2.3
-6.9
-0.8
-2.3
-3.7
2008
-4.6
-1.1
-1.5
-1.9
-2.7
0.0
-0.2
-2.5
-6.7
-1.2
-2.3
-3.2
2009
-7.5
-1.8
-2.3
-3.4
-4.0
-0.1
-0.2
-3.7
-7.4
-1.6
-1.3
-4.5
2009 Q3
-1.7
-0.3
-0.5
-0.9
-0.8
0.0
0.0
-0.7
-1.6
-0.3
-0.2
-1.0
Q4
-2.5
-0.8
-0.8
-0.9
-1.1
0.0
-0.1
-1.0
-2.3
-0.4
-0.6
-1.2
2010 Q1
-1.9
-1.1
-0.6
-0.2
-1.1
0.0
0.0
-1.1
-2.3
-0.5
-0.3
-1.4
2010 Jan.
-0.6
-0.4
0.0
-0.2
-0.4
0.0
0.0
-0.4
-1.1
-0.4
-0.2
-0.6
Feb.
-0.3
0.0
-0.1
-0.2
-0.4
0.0
0.0
-0.5
-0.6
-0.1
-0.1
-0.4
Mar.
-1.0
-0.7
-0.5
0.2
-0.2
0.0
0.0
-0.2
-0.6
-0.1
-0.1
-0.5
Apr.
-0.3
0.0
-0.1
-0.2
-0.2
0.0
0.0
-0.2
-0.4
-0.1
-0.1
-0.3

May (p)
-0.4
-0.1
-0.1
-0.2
-0.4
0.0
0.0
-0.4
-0.5
-0.1
-0.1
-0.3
2. Write-offs/write-downs of loans to non-financial corporations and non-euro area residents

Non-financial corporations
Non-euro area residents
Total
Up to
Over 1
Over
Total
Up to
Over 1
1 year
and up to
5 years
1 year
year
5 years
1
2
3
4
5
6
7
2007
-12.5
-2.1
-5.4
-4.9
-5.2
-3.4
-1.8
2008
-17.8
-4.1
-9.1
-4.6
-6.6
-3.4
-3.2
2009
-35.4
-12.7
-12.5
-10.2
-6.8
-2.6
-4.2
2009 Q3
-7.0
-2.2
-2.1
-2.7
-1.0
-0.5
-0.5
Q4
-15.2
-5.3
-6.3
-3.7
-2.1
-0.5
-1.6
2010 Q1
-11.4
-7.1
-4.0
-0.3
-1.0
-0.4
-0.6
2010 Jan.
-4.2
-1.2
-1.1
-1.9
-0.5
-0.4
-0.2
Feb.
-2.3
-0.5
-1.0
-0.8
-0.4
0.0
-0.4
Mar.
-4.9
-5.4
-2.0
2.4
-0.1
0.0
-0.1
Apr.
-4.6
-1.1
-2.4
-1.1
-0.1
-0.1
-0.1

May (p)
-5.2
-2.2
-1.6
-1.4
-0.5
-0.1
-0.3
3. Revaluation of securities held by MFIs

Securities other than shares
Shares and other equity

Total
MFIs
General
Other euro
Non-euro area
Total
MFIs
Non-MFIs
Non-euro area

government
area residents
residents
residents
Euro
Non-euro
Euro
Non-euro
Euro
Non-euro
1
2
3
4
5
6
7
8
9
10
11
12
2007
-14.2
-3.3
0.1
-0.4
-0.2
-3.2
-0.6
-6.7
27.6
3.8
11.7
12.1
2008
-60.5
-12.1
0.0
4.5
0.0
-19.1
-2.2
-31.7
-63.6
-9.2
-46.2
-8.2
2009
4.3
8.2
0.2
-0.8
-0.1
-1.0
0.8
-2.9
1.0
-5.9
3.4
3.5
2009 Q3
19.5
5.7
0.1
3.9
0.0
4.2
0.2
5.3
14.5
3.3
7.6
3.7
Q4
1.1
1.2
0.1
-1.5
-0.1
0.2
-0.1
1.2
-0.4
-1.7
0.6
0.8
2010 Q1
14.3
3.2
0.3
4.5
0.1
2.4
0.1
3.7
0.4
-1.0
-0.2
1.7
2010 Jan.
1.2
-0.1
0.1
-0.5
0.0
0.7
0.1
0.9
-2.7
-1.6
-0.8
-0.3
Feb.
7.9
1.6
0.1
3.6
0.1
1.1
0.0
1.4
-0.9
0.7
-2.1
0.4
Mar.
5.2
1.7
0.1
1.4
0.0
0.6
0.0
1.4
4.1
-0.1
2.6
1.5
Apr.
-4.0
-1.6
0.1
-3.6
0.0
-0.1
0.0
1.2
-4.1
-1.6
-3.0
0.5

May (p)
-0.6
-1.1
0.3
0.1
0.3
-1.6
0.1
1.4
-8.5
-2.1
-5.1
-1.3
Source: ECB.
1)
MFI sector excluding the Eurosystem; sectoral classification is based on the ESA 95.
2)
Data refer to the changing composition of the euro area. For further information, see the General Notes.
3)
Including non-profit institutions serving households.
ECB
Monthly Bulletin
July 2010 S 21

2.8 Currency breakdown of selected MFI balance sheet items 1), 2)
(percentages of total; outstanding amounts in EUR billions; end of period)
1. Deposits

MFIs 3)
Non-MFIs

All
Euro 4)
Non-euro currencies
All
Euro 4)
Non-euro currencies
currencies

currencies

(outstanding
Total

(outstanding
Total

amount)
amount)
USD
JPY
CHF
GBP
USD
JPY
CHF
GBP
1
2
3
4
5
6
7
8
9
10
11
12
13
14
By euro area residents
2007
6,087.5
92.1
7.9
4.8
0.4
1.1
1.0
9,054.4
95.8
4.2
2.2
0.4
0.1
0.5

2008
6,858.8
89.7
10.3
7.3
0.4
1.2
0.8
9,881.4
96.9
3.1
1.9
0.5
0.1
0.4
2009 Q2
6,625.7
92.2
7.8
5.1
0.3
1.1
0.8
10,145.9
97.0
3.0
1.9
0.3
0.1
0.5
Q3
6,287.5
92.4
7.6
4.8
0.4
1.1
0.8
10,061.2
97.0
3.0
1.9
0.3
0.1
0.4
Q4
6,287.1
93.0
7.0
4.4
0.3
1.1
0.7
10,178.7
97.0
3.0
1.9
0.2
0.1
0.4

2010 Q1 (p)
6,229.1
93.1
6.9
4.1
0.3
1.2
0.8
10,190.6
97.0
3.0
2.0
0.2
0.1
0.4
By non-euro area residents
2007
2,953.9
47.0
53.0
33.5
2.9
2.4
11.0
908.2
50.1
49.9
32.9
1.6
1.8
9.9

2008
2,818.1
48.3
51.7
33.4
2.8
2.6
10.2
897.4
54.9
45.1
28.7
1.4
1.9
9.4
2009 Q2
2,685.4
49.0
51.0
33.2
1.6
2.6
10.7
879.8
51.9
48.1
32.5
1.8
1.8
7.8
Q3
2,564.0
49.1
50.9
34.3
1.5
2.5
9.5
858.5
54.1
45.9
30.6
1.5
1.6
7.7
Q4
2,534.2
49.2
50.8
34.2
1.8
2.2
9.6
836.3
53.5
46.5
31.4
1.1
1.8
7.5

2010 Q1 (p)
2,660.0
50.4
49.6
33.2
2.0
2.1
9.1
884.8
54.2
45.8
32.2
1.1
1.4
6.3
2. Debt securities issued by euro area MFIs

All
Euro 4)
Non-euro currencies
currencies

(outstanding
Total

amount)
USD
JPY
CHF
GBP
1
2
3
4
5
6
7
2007
4,933.2
81.5
18.5
9.2
1.7
1.9
3.4

2008
5,111.7
83.3
16.7
8.4
2.0
1.9
2.5
2009 Q2
5,225.1
83.6
16.4
8.3
1.8
1.8
2.7
Q3
5,203.1
84.0
16.0
8.2
1.8
1.9
2.3
Q4
5,179.1
83.3
16.7
8.7
1.7
1.9
2.5

2010 Q1 (p)
5,289.1
82.5
17.5
9.4
1.6
1.9
2.5
Source: ECB.
1)
MFI sector excluding the Eurosystem; sectoral classification is based on the ESA 95.
2)
Data refer to the changing composition of the euro area. For further information, see the General Notes.
3)
For non-euro area residents, the term ‘‘MFIs’’ refers to institutions similar to euro area MFIs.
4)
Including items expressed in the national denominations of the euro.
ECB
S Monthly Bulletin
22 July 2010

EURO AREA
STATISTICS
Money,
banking
and
investment
funds
2.8 Currency breakdown of selected MFI balance sheet items 1), 2)
(percentages of total; outstanding amounts in EUR billions; end of period)
3. Loans

MFIs 3)
Non-MFIs

All
Euro 4)
Non-euro currencies
All
Euro 4)
Non-euro currencies
currencies

currencies

(outstanding
Total

(outstanding
Total

amount)
amount)
USD
JPY
CHF
GBP
USD
JPY
CHF
GBP
1
2
3
4
5
6
7
8
9
10
11
12
13
14
To euro area residents
2007
5,794.2
- - - - - -
11,098.9
96.2
3.8
1.8
0.2
0.9
0.6

2008
6,312.0
- - - - - -
11,740.6
95.9
4.1
2.1
0.3
1.0
0.4
2009 Q2
6,215.5
- - - - - -
11,835.0
96.1
3.9
2.0
0.2
1.0
0.5
Q3
5,911.3
- - - - - -
11,763.1
96.2
3.8
1.9
0.2
1.0
0.4
Q4
5,921.1
- - - - - -
11,782.6
96.2
3.8
1.9
0.2
1.0
0.4

2010 Q1 (p)
5,913.9
- - - - - -
11,828.4
96.1
3.9
2.0
0.2
1.0
0.4
To non-euro area residents
2007
2,344.5
48.2
51.8
28.8
2.3
2.4
12.7
955.7
40.9
59.1
41.2
1.2
3.7
8.2

2008
2,282.0
45.8
54.2
31.8
3.0
2.6
11.3
965.8
40.5
59.5
41.9
1.4
4.3
7.4
2009 Q2
1,999.9
45.2
54.8
29.6
2.8
3.2
13.5
949.3
40.2
59.8
42.5
1.1
3.9
7.6
Q3
1,894.1
45.5
54.5
29.9
2.7
3.1
12.6
914.0
40.4
59.6
41.9
1.5
3.8
7.6
Q4
1,917.4
45.8
54.2
29.4
2.7
2.9
12.6
908.9
40.1
59.9
42.0
1.2
3.7
8.0

2010 Q1 (p)
1,986.9
46.4
53.6
29.7
2.5
3.0
11.3
969.1
40.7
59.3
42.2
1.1
3.4
7.4
4. Holdings of securities other than shares

Issued by MFIs 3)
Issued by non-MFIs

All
Euro 4)
Non-euro currencies
All
Euro 4)
Non-euro currencies
currencies

currencies

(outstanding
Total

(outstanding
Total

amount)
amount)
USD
JPY
CHF
GBP
USD
JPY
CHF
GBP
1
2
3
4
5
6
7
8
9
10
11
12
13
14
Issued by euro area residents
2007
1,740.3
95.2
4.8
2.4
0.3
0.3
1.5
2,210.3
97.7
2.3
1.4
0.2
0.1
0.5

2008
1,977.4
95.3
4.7
2.6
0.4
0.2
1.2
2,652.7
97.3
2.7
1.7
0.3
0.1
0.4
2009 Q2
2,123.6
95.0
5.0
2.5
0.5
0.4
1.4
2,961.9
97.7
2.3
1.5
0.2
0.1
0.3
Q3
2,118.3
95.1
4.9
2.9
0.2
0.3
1.3
2,998.1
97.9
2.1
1.4
0.2
0.1
0.4
Q4
2,080.8
94.8
5.2
3.1
0.2
0.3
1.4
2,980.7
98.1
1.9
1.2
0.2
0.1
0.3

2010 Q1 (p)
2,094.2
94.6
5.4
3.3
0.2
0.3
1.4
3,033.7
98.1
1.9
1.2
0.2
0.1
0.3
Issued by non-euro area residents
2007
582.4
53.9
46.1
27.3
0.7
0.4
14.4
652.3
35.9
64.1
39.3
4.5
0.8
12.6

2008
580.7
54.1
45.9
28.6
0.9
0.5
13.3
646.8
39.0
61.0
37.1
6.4
0.8
11.0
2009 Q2
571.0
55.3
44.7
24.6
1.7
1.4
14.6
633.1
33.5
66.5
41.4
4.0
0.9
15.0
Q3
562.7
56.3
43.7
25.3
0.6
0.5
14.7
618.5
34.8
65.2
39.3
4.2
0.9
15.1

Q4
547.2
55.8
44.2
26.3
0.4
0.5
14.8
600.9
34.9
65.1
38.5
4.2
0.9
15.2
2010 Q1 (p)
564.0
55.1
44.9
28.0
0.4
0.5
14.9
610.1
32.9
67.1
39.5
4.4
0.9
15.1
Source: ECB.
1)
MFI sector excluding the Eurosystem; sectoral classification is based on the ESA 95.
2)
Data refer to the changing composition of the euro area. For further information, see the General Notes.
3)
For non-euro area residents, the term ‘‘MFIs’’ refers to institutions similar to euro area MFIs.
4)
Including items expressed in the national denominations of the euro.
ECB
Monthly Bulletin
July 2010 S 23

2.9 Aggregated balance sheet of euro area investment funds 1)
(EUR billions; outstanding amounts at end of period; transactions during period)
1. Assets
Total
Deposits and
Securities other
Shares and other
Investment fund/
Non-financial
Other assets
loan claims
than shares
equity (excl. money market fund
assets
(incl. financial
investment fund/
shares
derivatives)
money market fund
shares)
1
2
3
4
5
6
7
Outstanding amounts
2009 Oct.
5,175.8
351.2
2,017.8
1,523.5
688.1
207.9
387.2
Nov.
5,240.8
340.4
2,043.5
1,562.3
693.6
208.2
392.8
Dec.
5,370.6
343.7
2,076.7
1,673.4
709.0
212.6
355.2
2010 Jan.
5,453.5
353.3
2,120.1
1,650.3
726.7
215.5
387.7
Feb.
5,527.4
355.6
2,146.3
1,670.2
741.5
216.8
397.0
Mar.
5,779.1
350.5
2,209.7
1,802.9
767.0
233.7
415.4

Apr. (p)
5,857.2
351.5
2,232.7
1,817.6
780.6
235.1
439.6
Transactions
2009 Q3
173.1
-9.0
69.9
112.6
9.1
2.7
-12.1
Q4
87.2
-11.9
58.2
42.7
15.5
5.9
-23.2

2010 Q1
184.6
-3.3
65.9
30.5
29.9
17.8
43.8
2. Liabilities

Total
Loans and
Investment fund shares issued
Other
deposits

liabilities
received
Total
Held by euro area residents
Held by
(incl. financial
non-euro area
derivatives)
Investment
residents
funds
1
2
3
4
5
6
7
Outstanding amounts
2009 Oct.
5,175.8
97.5
4,747.0
3,875.1
522.9
871.9
331.3
Nov.
5,240.8
98.2
4,808.0
3,911.5
528.8
896.5
334.6
Dec.
5,370.6
101.2
4,965.2
4,020.1
539.6
945.1
304.2
2010 Jan.
5,453.5
101.1
5,014.7
4,042.9
546.7
971.8
337.7
Feb.
5,527.4
101.0
5,077.1
4,082.1
559.3
995.0
349.3
Mar.
5,779.1
113.1
5,293.0
4,221.8
582.6
1,071.2
373.0

Apr. (p)
5,857.2
114.0
5,354.3
4,234.9
594.0
1,119.4
389.0
Transactions
2009 Q3
173.1
0.8
186.2
94.7
16.7
91.4
-13.9
Q4
87.2
4.0
107.7
77.1
15.3
30.6
-24.5

2010 Q1
184.6
5.4
132.4
96.2
22.2
36.2
46.8
3. Investment fund shares issued broken down by investment policy and type of fund

Total
Funds by investment policy
Funds by type
Memo item:
Money market
Bond
Equity
Mixed
Real estate
Hedge
Other
Open-end
Closed-end
funds
funds
funds
funds
funds
funds
funds
funds
funds
1
2
3
4
5
6
7
8
9
10
Outstanding amounts
2009 Sep.
4,739.2
1,531.5
1,344.6
1,164.8
227.8
77.4
393.1
4,671.3
67.9
1,253.0
Oct.
4,747.0
1,547.8
1,323.7
1,178.3
232.3
78.8
386.2
4,679.3
67.7
1,246.2
Nov.
4,808.0
1,561.5
1,350.4
1,194.1
234.9
78.8
388.3
4,740.5
67.5
1,223.7
Dec.
4,965.2
1,577.6
1,451.1
1,215.6
240.3
84.4
396.1
4,893.8
71.4
1,201.6
2010 Jan.
5,014.7
1,613.9
1,422.4
1,237.8
242.5
93.7
404.4
4,944.7
70.0
1,215.5
Feb.
5,077.1
1,639.3
1,441.4
1,248.5
244.3
95.6
408.0
5,006.4
70.7
1,202.0
Mar.
5,293.0
1,701.9
1,551.3
1,272.3
250.5
97.9
419.1
5,218.4
74.6
1,174.8

Apr. (p)
5,354.3
1,727.1
1,569.1
1,286.6
249.3
99.7
422.4
5,279.7
74.6
1,182.5
Transactions
2009 Oct.
36.6
14.1
5.7
16.3
2.6
1.1
-3.3
36.9
-0.2
-5.2
Nov.
20.0
8.6
5.3
4.4
1.2
-0.5
1.0
20.0
-0.1
-18.6
Dec.
51.1
4.9
18.8
15.4
7.0
2.7
2.2
47.3
3.7
-36.7
2010 Jan.
60.9
20.2
10.6
11.2
7.9
7.3
3.8
60.2
0.8
3.0
Feb.
21.8
13.3
4.1
3.0
1.1
0.2
0.0
21.6
0.1
-16.7
Mar.
49.7
39.6
2.3
-5.6
1.2
3.6
8.6
48.3
1.4
-30.1

Apr. (p)
28.6
15.0
-0.7
11.6
0.5
-0.1
2.2
28.9
-0.3
-2.2
Source: ECB.
1) Other than money market funds (which are shown as a memo item in column 10 in Table 3 of this section). For further details, see the General Notes.
ECB
S Monthly Bulletin
24 July 2010

EURO AREA
STATISTICS
Money,
banking
and
investment
funds
2.10 Securities held by investment funds 1) broken down by issuer of securities
(EUR billions; outstanding amounts at end of period; transactions during period)
1. Securities other than shares

Total
Euro area
Rest of the world
Total
MFIs
General
Other
Insurance
Non-financial
EU
United
Japan
government
financial
corporations
corporations
Member States
States
intermediaries
and pension
outside the
funds
euro area
1
2
3
4
5
6
7
8
9
10
11
Outstanding amounts
2009 Q2
1,872.9
1,293.8
357.9
635.7
173.3
4.0
122.9
579.1
161.9
234.6
21.8
Q3
1,998.6
1,384.6
388.6
669.0
186.0
4.9
136.2
614.0
180.2
234.4
21.8
Q4
2,076.7
1,413.3
387.7
689.1
186.8
5.5
144.3
663.3
198.8
252.0
15.9

2010 Q1 (p)
2,209.7
1,463.1
392.5
710.1
199.5
5.9
155.1
746.6
211.4
290.2
15.3
Transactions
2009 Q3
69.9
47.6
10.6
20.9
6.1
0.3
9.7
22.2
11.2
3.5
-1.0
Q4
58.2
23.9
-2.9
19.0
0.2
0.5
7.1
34.3
15.9
13.3
-6.2

2010 Q1 (p)
65.9
24.4
0.3
9.0
8.2
0.0
6.8
41.5
10.7
16.4
-1.6
2. Shares and other equity (other than investment fund and money market fund shares)

Total
Euro area
Rest of the world
Total
MFIs
General
Other
Insurance
Non-financial
EU
United
Japan
government
financial
corporations
corporations
Member States
States
intermediaries
and pension
outside the
funds
euro area
1
2
3
4
5
6
7
8
9
10
11
Outstanding amounts
2009 Q2
1,251.3
565.6
69.5
- 28.7
16.8
450.4
685.8
110.8
210.9
59.7
Q3
1,544.6
701.4
97.2
- 35.8
24.8
543.4
843.2
127.0
265.1
61.8
Q4
1,673.4
723.3
97.5
- 36.1
23.8
565.7
950.1
138.4
295.4
65.8

2010 Q1 (p)
1,802.9
742.3
92.8
- 37.5
28.3
583.5
1,060.5
147.2
327.8
75.3
Transactions
2009 Q3
112.6
34.6
7.5
- 4.1
2.3
20.6
78.0
2.4
34.0
1.4
Q4
42.7
3.4
4.6
- 1.0
-0.7
-1.5
39.3
3.2
7.4
3.5

2010 Q1 (p)
30.5
8.7
-0.1
- 0.6
1.8
6.4
21.8
0.2
1.8
0.9
3. Investment fund/money market fund shares

Total
Euro area
Rest of the world
Total
MFIs 2)
General
Other
Insurance
Non-financial
EU
United
Japan
government
financial
corporations
corporations
Member States
States
intermediaries 2)
and pension
outside the
funds
euro area
1
2
3
4
5
6
7
8
9
10
11
Outstanding amounts
2009 Q2
628.0
540.2
82.9
- 457.3
-
-
87.9
12.9
16.2
0.4
Q3
680.4
592.0
78.1
- 514.0
-
-
88.4
14.5
18.9
0.3
Q4
709.0
614.1
74.4
- 539.6
-
-
95.0
15.7
19.0
0.3

2010 Q1 (p)
767.0
654.1
71.5
- 582.6
-
-
112.9
18.2
33.5
0.5
Transactions
2009 Q3
9.1
10.5
-6.2
- 16.7
- -
-1.5
0.9
-0.3
0.0
Q4
15.5
10.9
-4.4
- 15.3
- -
4.6
0.9
-0.4
0.1

2010 Q1 (p)
29.9
18.4
-3.7
- 22.2
- -
11.5
1.3
12.2
0.2
Source: ECB.
1) Other than money market funds. For further details, see the General Notes.
2) Investment fund shares (other than money market fund shares) are issued by other financial intermediaries. Money market fund shares are issued by MFIs.
ECB
Monthly Bulletin
July 2010 S 25

3 EURO AREA ACCOUNTS
3.1 Integrated economic and financial accounts by institutional sector
(EUR billions)
Uses
Euro
Households Non-financial
Financial
General
Rest of
area
corporations corporations
government the world
2009 Q4
External account
Exports of goods and services

471.4
Trade balance 1)

-29.2
Generation of income account
Gross value added (basic prices)

Taxes less subsidies on products
Gross domestic product (market prices)
Compensation of employees
1,189.9
120.7
743.2
60.5
265.5

Other taxes less subsidies on production
31.1
7.2
13.4
5.0
5.5

Consumption of fixed capital
351.2
96.8
196.9
11.4
46.1

Net operating surplus and mixed income 1)
526.2
277.2
225.5
26.0
-2.5

Allocation of primary income account
Net operating surplus and mixed income
Compensation of employees

4.9
Taxes less subsidies on production
Property income
635.6
34.6
233.5
307.5
59.9
91.4
Interest
366.0
31.6
59.1
215.4
59.9
52.3
Other property income
269.6
3.0
174.5
92.1
0.0
39.1
Net national income 1)
1,991.6
1,646.1
83.6
22.2
239.7

Secondary distribution of income account
Net national income
Current taxes on income, wealth, etc.
293.6
244.3
42.1
6.8
0.3
1.4
Social contributions
448.9
448.9

1.1
Social benefits other than social transfers in kind
471.1
1.5
16.1
33.5
420.0
0.8
Other current transfers
208.4
75.1
27.3
47.9
58.2
9.1
Net non-life insurance premiums
45.0
32.1
11.2
1.0
0.7
1.3
Non-life insurance claims
45.3

45.3

0.6
Other
118.1
43.0
16.0
1.6
57.4
7.2
Net disposable income 1)
1,959.2
1,443.6
26.8
29.0
459.8

Use of income account
Net disposable income
Final consumption expenditure
1,865.1
1,321.2

544.0

Individual consumption expenditure
1,647.3
1,321.2

326.1

Collective consumption expenditure
217.9

217.9

Adjustment for the change in the net equity of households in pension fund reserves
14.8
0.1
0.2
14.6
0.0
0.0
Net saving/current external account 1)
94.0
137.1
26.6
14.4
-84.1
-7.0
Capital account
Net saving/current external account
Gross capital formation
438.3
138.7
207.4
13.1
79.1

Gross fixed capital formation
461.6
137.9
231.6
12.9
79.1

Changes in inventories and acquisitions less disposals of valuables
-23.3
0.8
-24.2
0.1
0.0

Consumption of fixed capital
Acquisitions less disposals of non-produced non-financial assets
-0.2
-1.8
0.8
0.1
0.7
0.2
Capital transfers
60.9
13.9
1.2
1.3
44.4
5.4
Capital
taxes
10.9
10.6
0.3
0.0
0.0
Other capital transfers
49.9
3.4
0.9
1.3
44.4
5.4
Net lending (+)/net borrowing (-) (from capital account) 1)
10.5
97.1
46.3
14.3
-147.2
-10.5
Statistical discrepancy
0.0
2.3
-2.3
0.0
0.0
0.0
Sources: ECB and Eurostat.
1) For details of the calculation of the balancing items, see the Technical Notes.
ECB
S Monthly Bulletin
26 July 2010

EURO AREA
STATISTICS
Euro area
accounts
3.1 Integrated economic and financial accounts by institutional sector (cont'd)
(EUR billions)
Resources
Euro
Households Non-financial
Financial
General
Rest of
area
corporations corporations
government the world
2009 Q4
External account
Imports of goods and services

442.2
Trade balance
Generation of income account
Gross value added (basic prices)
2,098.4
501.9
1,179.0
102.9
314.6

Taxes less subsidies on products
234.2

Gross domestic product (market prices)2)
2,332.6

Compensation of employees
Other taxes less subsidies on production

Consumption of fixed capital

Net operating surplus and mixed income
Allocation of primary income account
Net operating surplus and mixed income
526.2
277.2
225.5
26.0
-2.5

Compensation of employees
1,191.3
1,191.3

3.6
Taxes less subsidies on production
279.9

279.9
-14.6
Property income
629.8
212.2
91.6
303.8
22.1
97.2
Interest
354.5
53.9
36.4
255.6
8.7
63.7
Other property income
275.2
158.4
55.3
48.2
13.4
33.5
Net national income
Secondary distribution of income account
Net national income
1,991.6
1,646.1
83.6
22.2
239.7

Current taxes on income, wealth, etc.
294.2

294.2
0.8
Social contributions
448.9
1.3
16.9
48.5
382.2
1.1
Social benefits other than social transfers in kind
469.1
469.1

2.8
Other current transfers
177.4
97.0
11.7
46.4
22.2
40.2
Net non-life insurance premiums
45.3

45.3

1.1
Non-life insurance claims
44.4
34.2
9.2
0.7
0.3
1.4
Other
87.7
62.9
2.5
0.4
21.9
37.7
Net disposable income
Use of income account
Net disposable income
1,959.2
1,443.6
26.8
29.0
459.8

Final consumption expenditure
Individual consumption expenditure
Collective consumption expenditure
Adjustment for the change in the net equity of households in pension fund reserves
14.8
14.8

0.0
Net saving/current external account
Capital account
Net saving/current external account
94.0
137.1
26.6
14.4
-84.1
-7.0
Gross capital formation
Gross fixed capital formation
Changes in inventories and acquisitions less disposals of valuables
Consumption of fixed capital
351.2
96.8
196.9
11.4
46.1

Acquisitions less disposals of non-produced non-financial assets
Capital transfers
64.2
14.0
32.3
2.9
15.1
2.0
Capital
taxes
10.9

10.9
0.0
Other capital transfers
53.3
14.0
32.3
2.9
4.1
2.0
Net lending (+)/net borrowing (-) (from capital account)
Statistical discrepancy
Sources: ECB and Eurostat.
2) Gross domestic product is equal to the gross value added of all domestic sectors plus net taxes (i.e. taxes less subsidies) on products.
ECB
Monthly Bulletin
July 2010 S 27

3.1 Integrated economic and financial accounts by institutional sector (cont'd)
(EUR billions)
Assets
Euro
Households Non-financial
MFIs
Other
Insurance
General
Rest of
area
corporations
financial corporations
govern-
the world
inter-
and pension
ment
2009 Q4
mediaries
funds
Opening balance sheet, financial assets
Total financial assets

17,858.5
15,622.3
32,292.6
12,592.4
6,270.2
3,434.4
15,134.1
Monetary gold and special drawing rights (SDRs)

285.9

Currency and deposits

6,305.3
1,732.0
9,325.4
1,988.5
845.7
707.7
3,700.9
Short-term debt securities

34.3
134.5
632.4
318.3
360.4
24.6
874.5
Long-term debt securities

1,445.0
176.8
6,408.4
2,006.3
2,045.7
372.8
3,137.6
Loans

75.4
2,917.0
12,705.3
3,034.2
419.3
469.8
1,740.6

of which: Long-term
58.0
1,614.3
9,776.9
2,526.4
312.1
360.1
.
Shares and other equity

4,144.0
7,146.8
2,050.7
4,996.7
2,147.3
1,265.6
5,137.5
Quoted
shares

720.2
1,212.4
522.9
1,716.2
409.7
295.2
.

Unquoted shares and other equity

2,047.0
5,550.1
1,179.4
2,631.3
437.7
824.2
.

Mutual fund shares

1,376.7
384.3
348.4
649.2
1,299.8
146.2
.
Insurance technical reserves

5,383.6
145.0
1.9
0.0
191.3
3.2
140.3
Other accounts receivable and financial derivatives

471.0
3,370.3
882.5
248.4
260.6
590.6
402.5
Net financial worth
Financial account, transactions in financial assets
Total transactions in financial assets

161.6
154.0
28.5
196.7
78.9
-46.2
91.1
Monetary gold and SDRs

1.0

-1.0
Currency and deposits

111.9
54.4
62.4
-29.1
-1.5
-51.2
-97.1
Short-term debt securities

-21.9
3.7
-20.4
-10.6
21.5
7.2
-20.7
Long-term debt securities

-17.0
17.3
-55.5
85.6
10.5
-19.4
68.9
Loans

-0.3
24.8
-8.3
1.6
0.0
-15.0
24.0

of which: Long-term
-0.5
9.1
65.8
4.1
3.5
3.1
.
Shares and other equity

0.0
-27.3
-18.3
138.9
48.6
3.2
110.9
Quoted
shares

-6.9
-18.3
13.6
69.0
-1.3
3.8
.

Unquoted shares and other equity

6.7
8.3
-3.9
56.2
1.1
-4.0
.

Mutual fund shares

0.3
-17.2
-28.1
13.7
48.9
3.4
.
Insurance technical reserves

73.5
-0.4
0.1
0.0
0.8
0.0
6.6
Other accounts receivable and financial derivatives

15.5
81.4
67.6
10.3
-1.1
28.8
-0.6
Changes in net financial worth due to transactions
Other changes account, financial assets
Total other changes in financial assets

53.5
233.9
42.1
39.0
71.6
27.1
115.6
Monetary gold and SDRs

30.0

Currency and deposits

0.6
-2.0
35.9
12.3
2.6
-0.9
30.0
Short-term debt securities

-0.9
-0.3
3.0
-6.7
6.2
0.0
-12.9
Long-term debt securities

2.1
12.9
-16.6
15.3
29.2
-2.4
-0.5
Loans

0.0
-0.5
-0.7
-12.3
-0.8
-1.5
4.6

of which: Long-term
0.0
-5.3
-13.9
-13.5
-0.8
4.7
.
Shares and other equity

30.3
261.8
-6.7
21.8
34.7
12.7
74.6
Quoted
shares

18.1
115.9
-23.1
20.3
8.3
-11.1
.

Unquoted shares and other equity

0.4
142.5
3.8
-13.5
-0.2
26.2
.

Mutual fund shares

11.9
3.4
12.6
14.9
26.6
-2.4
.
Insurance technical reserves

21.5
0.1
0.0
0.0
-0.1
0.0
5.3
Other accounts receivable and financial derivatives

-0.2
-38.1
-2.8
8.6
-0.3
19.3
14.6
Other changes in net financial worth
Closing balance sheet, financial assets
Total financial assets

18,073.6
16,010.2
32,363.2
12,828.2
6,420.6
3,415.3
15,341.7
Monetary gold and SDRs

316.9

Currency and deposits

6,417.9
1,784.4
9,423.6
1,971.8
846.7
655.7
3,633.8
Short-term debt securities

11.5
137.9
615.0
301.0
388.2
31.8
841.0
Long-term debt securities

1,430.1
207.0
6,336.3
2,107.2
2,085.4
351.0
3,206.0
Loans

75.0
2,941.3
12,696.4
3,023.5
418.5
453.4
1,769.2

of which: Long-term
57.4
1,618.2
9,828.7
2,517.0
314.9
367.9
.
Shares and other equity

4,174.3
7,381.3
2,025.7
5,157.3
2,230.6
1,281.5
5,323.0
Quoted
shares

731.3
1,310.0
513.5
1,805.5
416.7
287.8
.

Unquoted shares and other equity

2,054.1
5,700.8
1,179.4
2,674.0
438.7
846.5
.

Mutual fund shares

1,388.9
370.5
332.9
677.8
1,375.3
147.1
.
Insurance technical reserves

5,478.6
144.7
2.0
0.0
192.1
3.2
152.2
Other accounts receivable and financial derivatives

486.3
3,413.5
947.4
267.3
259.2
638.8
416.6
Net financial worth
Source: ECB.
ECB
S Monthly Bulletin
28 July 2010

EURO AREA
STATISTICS
Euro area
accounts
3.1 Integrated economic and financial accounts by institutional sector (cont'd)
(EUR billions)
Liabilities
Euro
Households
Non-financial
MFIs
Other
Insurance
General
Rest of
area
corporations
financial
corporations
govern-
the world
inter-
and pension
ment
2009 Q4
mediaries
funds
Opening balance sheet, liabilities
Total liabilities

6,431.3
24,377.8
31,527.4
12,565.9
6,419.4
8,158.4
13,438.4
Monetary gold and special drawing rights (SDRs)
Currency and deposits

29.5
21,916.5
27.2
0.0
223.4
2,409.0
Short-term debt securities

326.2
680.2
63.5
9.2
1,051.0
248.8
Long-term debt securities

490.7
4,599.3
2,564.9
39.4
5,129.0
2,769.3
Loans

5,762.9
8,308.5

2,780.9
256.6
1,345.8
2,907.0

of which: Long-term
5,403.6
5,892.6

1,796.3
99.5
1,132.5
.
Shares and other equity

11,849.0
3,008.5
6,905.8
489.2
5.4
4,624.0
Quoted
shares

3,299.0
595.0
189.7
176.1
0.0
.

Unquoted shares and other equity

6.6
8,549.9
1,160.7
2,157.7
312.3
5.4
.

Mutual fund shares

1,252.7
4,558.4

.
Insurance technical reserves

33.9
332.2
67.3
0.8
5,430.7
0.4

Other accounts payable and financial derivatives

627.9
3,041.6
1,255.6
222.7
194.4
403.5
480.3
Net financial worth 1)
-1,409.7
11,427.3
-8,755.5
765.2
26.6
-149.3
-4,724.0

Financial account, transactions in liabilities
Total transactions in liabilities

62.2
109.9
48.7
180.9
60.2
101.0
101.6
Monetary gold and SDRs
Currency and deposits

-0.1
35.6
-3.4
0.0
10.7
7.1
Short-term debt securities

-12.6
5.2
9.8
-0.7
-44.0
1.2
Long-term debt securities

22.0
-39.8
30.1
0.7
71.0
6.4
Loans

45.4
19.4

-10.8
-18.5
4.2
-12.9

of which: Long-term
45.6
38.6

-2.3
-2.4
32.8
.
Shares and other equity

30.5
-30.3
143.7
3.0
1.6
107.6
Quoted
shares

9.5
14.5
8.7
2.7
0.0
.

Unquoted shares and other equity

0.0
21.0
15.7
38.3
0.2
1.6
.

Mutual fund shares

-60.5
96.7

.
Insurance technical reserves

0.1
0.1
1.8
0.0
78.7
0.0

Other accounts payable and financial derivatives

16.7
50.7
76.2
11.5
-3.0
57.5
-7.8
Changes in net financial worth due to transactions 1)
10.5
99.3
44.1
-20.2
15.8
18.7
-147.2
-10.5
Other changes account, liabilities
Total other changes in liabilities

1.4
261.3
19.9
101.4
27.7
-40.4
181.4
Monetary gold and SDRs
Currency and deposits

0.0
58.1
0.0
0.0
0.0
20.2
Short-term debt securities

-9.5
2.4
-1.4
1.1
1.1
-5.1
Long-term debt securities

4.3
14.8
14.7
0.5
-33.3
39.0
Loans

-3.5
-15.1

14.6
-1.7
-0.2
-5.3

of which: Long-term
-2.2
-3.1
5.0
-1.2
-0.1
.
Shares and other equity

283.6
-42.7
88.7
-3.9
-0.6
104.0
Quoted
shares

121.1
-36.2
-6.3
-6.9
0.0
.

Unquoted shares and other equity

0.1
162.5
-15.6
-8.3
3.0
-0.6
.

Mutual fund shares

9.1
103.3

.
Insurance technical reserves

0.2
0.0
0.0
0.0
26.7
0.0

Other accounts payable and financial derivatives

4.6
-1.9
-12.6
-15.1
5.2
-7.5
28.5
Other changes in net financial worth 1)
95.8
52.1
-27.4
22.2
-62.4
43.8
67.6
-65.8
Closing balance sheet, liabilities
Total liabilities

6,494.9
24,749.0
31,596.0
12,848.2
6,507.3
8,219.0
13,721.4
Monetary gold and SDRs
Currency and deposits

29.4
22,010.3
23.8
0.0
234.0
2,436.3
Short-term debt securities

304.1
687.7
71.9
9.6
1,008.1
244.9
Long-term debt securities

517.0
4,574.3
2,609.8
40.6
5,166.7
2,814.7
Loans

5,804.8
8,312.8

2,784.7
236.3
1,349.9
2,888.8

of which: Long-term
5,447.0
5,928.1

1,799.0
95.8
1,165.2
.
Shares and other equity

12,163.0
2,935.4
7,138.2
488.3
6.4
4,835.7
Quoted
shares

3,429.7
573.4
192.1
171.9
0.0
.

Unquoted shares and other equity

6.7
8,733.4
1,160.8
2,187.7
315.5
6.4
.

Mutual fund shares

1,201.3
4,758.3

.
Insurance technical reserves

34.1
332.3
69.1
0.8
5,536.0
0.4

Other accounts payable and financial derivatives

649.3
3,090.4
1,319.2
219.1
196.6
453.5
501.0
Net financial worth 1)
-1,303.4
11,578.7
-8,738.9
767.2
-20.0
-86.7
-4,803.7

Source: ECB.
ECB
Monthly Bulletin
July 2010 S 29

3.2 Euro area non-financial accounts
(EUR billions; four-quarter cumulated flows)
Uses
2008 Q1-
2008 Q2-
2008 Q3-
2008 Q4-
2009 Q1-
2005
2006
2007
2008 Q4
2009 Q1
2009 Q2
2009 Q3
2009 Q4
Generation of income account

Gross value added (basic prices)

Taxes less subsidies on products

Gross domestic product (market prices)

Compensation of employees
3,906.8
4,069.0
4,256.9
4,433.7
4,439.5
4,437.3
4,428.8
4,420.4
Other taxes less subsidies on production
129.8
129.3
137.1
131.7
128.7
121.8
116.5
109.2
Consumption of fixed capital
1,190.3
1,250.6
1,318.1
1,381.5
1,391.8
1,398.7
1,403.5
1,407.4
Net operating surplus and mixed income 1)
2,067.3
2,183.2
2,328.7
2,342.6
2,277.8
2,197.2
2,152.2
2,141.6

Allocation of primary income account

Net operating surplus and mixed income

Compensation
of
employees

Taxes less subsidies on production

Property income
2,585.5
3,013.8
3,580.0
3,864.4
3,740.9
3,495.6
3,224.1
2,985.4
Interest
1,344.6
1,643.3
2,058.0
2,306.8
2,211.9
2,051.3
1,836.2
1,640.7
Other property income
1,240.9
1,370.5
1,522.0
1,557.6
1,528.9
1,444.3
1,387.8
1,344.7
Net national income 1)
6,967.8
7,321.7
7,703.1
7,787.9
7,703.1
7,610.2
7,547.1
7,532.9

Secondary distribution of income account

Net national income

Current taxes on income, wealth, etc.
935.9
1,028.2
1,111.7
1,122.8
1,111.6
1,074.4
1,044.6
1,017.7
Social contributions
1,477.9
1,539.8
1,595.2
1,660.9
1,668.4
1,668.3
1,670.5
1,672.0
Social benefits other than social transfers in kind
1,505.5
1,553.4
1,598.9
1,665.6
1,690.0
1,721.3
1,752.3
1,781.5
Other current transfers
712.0
723.3
752.8
792.0
786.8
779.0
770.3
767.7
Net non-life insurance premiums
179.6
179.9
184.3
189.8
187.0
183.5
179.0
175.0
Non-life insurance claims
180.5
180.2
184.1
190.9
188.0
184.2
179.6
175.4
Other
351.9
363.2
384.4
411.3
411.8
411.2
411.7
417.3
Net disposable income 1)
6,881.4
7,229.5
7,608.5
7,682.5
7,597.5
7,503.6
7,438.5
7,422.9

Use of income account

Net disposable income

Final consumption expenditure
6,355.4
6,631.8
6,893.4
7,161.8
7,169.8
7,164.5
7,158.9
7,174.5
Individual consumption expenditure
5,690.5
5,946.6
6,181.8
6,410.6
6,407.8
6,394.9
6,382.4
6,392.8
Collective consumption expenditure
664.9
685.3
711.6
751.2
762.0
769.6
776.5
781.7
Adjustment for the change in the net equity of households

in pension fund reserves
60.8
62.9
60.1
64.9
64.7
63.0
60.9
59.5
Net saving 1)
526.4
597.9
715.2
520.7
427.7
339.1
279.6
248.5

Capital account

Net saving

Gross capital formation
1,716.7
1,875.4
2,019.9
2,058.1
1,991.4
1,891.8
1,808.9
1,738.0
Gross fixed capital formation
1,709.9
1,853.4
1,992.6
2,022.5
1,970.7
1,899.7
1,839.0
1,795.7
Changes in inventories and acquisitions less disposals of valuables
6.8
22.1
27.4
35.6
20.7
-7.9
-30.0
-57.6
Consumption of fixed capital

Acquisitions less disposals of non-produced non-financial assets
-0.4
-0.4
-1.1
0.7
1.1
0.7
0.4
0.2
Capital transfers
183.7
169.9
151.5
160.8
159.1
170.1
172.2
179.0
Capital
taxes
24.4
22.5
24.3
23.8
23.6
28.6
29.0
33.9
Other capital transfers
159.3
147.4
127.2
137.0
135.5
141.6
143.3
145.2
Net lending (+)/net borrowing (-) (from capital account) 1)
13.5
-12.0
29.3
-145.7
-164.5
-145.9
-117.1
-73.1

Sources: ECB and Eurostat.
1) For details of the calculation of the balancing items, see the Technical Notes.
ECB
S Monthly Bulletin
30 July 2010

EURO AREA
STATISTICS
Euro area
accounts
3.2 Euro area non-financial accounts (cont'd)
(EUR billions; four-quarter cumulated flows)
Resources
2008 Q1-
2008 Q2-
2008 Q3-
2008 Q4-
2009 Q1-
2005
2006
2007
2008 Q4
2009 Q1
2009 Q2
2009 Q3
2009 Q4
Generation of income account

Gross value added (basic prices)
7,294.3
7,632.1
8,040.8
8,289.6
8,237.8
8,155.0
8,101.1
8,078.5
Taxes less subsidies on products
845.3
914.0
959.5
946.5
930.2
913.7
902.7
895.1
Gross domestic product (market prices)2)
8,139.6
8,546.1
9,000.4
9,236.1
9,168.0
9,068.7
9,003.8
8,973.6

Compensation
of
employees

Other taxes less subsidies on production

Consumption of fixed capital

Net operating surplus and mixed income

Allocation of primary income account

Net operating surplus and mixed income
2,067.3
2,183.2
2,328.7
2,342.6
2,277.8
2,197.2
2,152.2
2,141.6
Compensation of employees
3,914.1
4,076.5
4,264.9
4,442.1
4,447.7
4,445.4
4,436.6
4,427.4
Taxes less subsidies on production
988.2
1,054.7
1,103.6
1,084.3
1,064.6
1,042.3
1,027.6
1,019.7
Property income
2,583.8
3,021.0
3,585.9
3,783.4
3,654.0
3,420.9
3,154.7
2,929.7
Interest
1,319.0
1,613.7
2,016.4
2,245.4
2,146.8
1,984.9
1,767.3
1,574.4
Other property income
1,264.8
1,407.3
1,569.5
1,538.0
1,507.2
1,436.0
1,387.5
1,355.2
Net national income

Secondary distribution of income account

Net national income
6,967.8
7,321.7
7,703.1
7,787.9
7,703.1
7,610.2
7,547.1
7,532.9
Current taxes on income, wealth, etc.
939.5
1,032.9
1,119.1
1,131.0
1,119.6
1,080.7
1,050.1
1,023.4
Social contributions
1,477.2
1,539.0
1,594.4
1,660.3
1,667.5
1,667.2
1,669.5
1,671.2
Social benefits other than social transfers in kind
1,497.9
1,545.4
1,590.0
1,657.5
1,681.9
1,713.4
1,744.6
1,773.7
Other current transfers
630.5
635.3
660.5
687.2
682.1
675.1
664.8
660.5
Net non-life insurance premiums
180.5
180.2
184.1
190.9
188.0
184.2
179.6
175.4
Non-life insurance claims
178.3
177.1
181.5
187.3
184.3
180.8
176.1
172.1
Other
271.6
277.9
294.9
309.1
309.8
310.1
309.1
313.0
Net disposable income

Use of income account

Net disposable income
6,881.4
7,229.5
7,608.5
7,682.5
7,597.5
7,503.6
7,438.5
7,422.9
Final consumption expenditure

Individual consumption expenditure

Collective consumption expenditure

Adjustment for the change in the net equity of households

in pension fund reserves
61.0
63.1
60.3
64.9
64.7
63.0
60.9
59.5
Net saving

Capital account

Net saving
526.4
597.9
715.2
520.7
427.7
339.1
279.6
248.5
Gross capital formation

Gross fixed capital formation

Changes in inventories and acquisitions less disposals of valuables

Consumption of fixed capital
1,190.3
1,250.6
1,318.1
1,381.5
1,391.8
1,398.7
1,403.5
1,407.4
Acquisitions less disposals of non-produced non-financial assets

Capital transfers
196.8
184.4
166.2
171.7
167.5
178.9
181.3
188.4
Capital
taxes
24.4
22.5
24.3
23.8
23.6
28.6
29.0
33.9
Other capital transfers
172.3
161.9
142.0
147.9
144.0
150.4
152.3
154.5
Net lending (+)/net borrowing (-) (from capital account)

Sources: ECB and Eurostat.
2) Gross domestic product is equal to the gross value added of all domestic sectors plus net taxes (i.e. taxes less subsidies) on products.
ECB
Monthly Bulletin
July 2010 S 31

3.3 Households
(EUR billions; four-quarter cumulated flows; outstanding amounts at end of period)
2008 Q1-
2008 Q2-
2008 Q3-
2008 Q4-
2009 Q1-
2005
2006
2007
2008 Q4
2009 Q1
2009 Q2
2009 Q3
2009 Q4
Income, saving and changes in net worth

Compensation of employees (+)
3,914.1
4,076.5
4,264.9
4,442.1
4,447.7
4,445.4
4,436.6
4,427.4
Gross operating surplus and mixed income (+)
1,338.9
1,415.3
1,499.4
1,550.8
1,543.7
1,531.4
1,520.4
1,515.9
Interest receivable (+)
225.4
261.6
304.9
336.6
321.9
296.2
263.5
235.4
Interest payable (-)
130.5
163.4
209.1
233.7
217.4
192.6
164.0
139.8
Other property income receivable (+)
702.7
747.7
790.2
795.4
787.3
762.1
745.1
736.3
Other property income payable (-)
9.5
9.8
10.0
10.1
10.2
10.3
10.3
10.2
Current taxes on income and wealth (-)
741.7
794.3
851.7
892.3
890.3
877.8
871.8
860.8
Net social contributions (-)
1,474.0
1,535.7
1,591.0
1,656.5
1,664.0
1,663.7
1,665.9
1,667.2
Net social benefits (+)
1,492.6
1,539.9
1,584.3
1,651.7
1,676.0
1,707.5
1,738.7
1,767.8
Net current transfers receivable (+)
66.4
66.7
69.4
72.1
73.6
76.7
79.8
82.1
= Gross disposable income
5,384.4
5,604.3
5,851.5
6,056.1
6,068.3
6,074.9
6,072.1
6,086.9
Final consumption expenditure (-)
4,690.6
4,897.9
5,088.5
5,267.0
5,249.0
5,225.1
5,198.6
5,197.8
Changes in net worth in pension funds (+)
60.6
62.7
59.8
64.6
64.3
62.7
60.6
59.2

= Gross saving
754.4
769.2
822.8
853.7
883.6
912.4
934.0
948.3

Consumption of fixed capital (-)
326.0
345.2
366.0
384.1
386.5
388.2
389.4
389.8

Net capital transfers receivable (+)
24.0
18.7
12.0
13.5
13.1
14.3
15.7
10.9

Other changes in net worth 1) (+)
565.8
523.4
62.3
-1,689.2
-1,330.9
-722.3
56.9
524.0

= Changes in net worth 1)
1,018.1
966.1
531.1
-1,206.1
-820.7
-183.8
617.2
1,093.4
Investment, financing and changes in net worth

Net acquisition of non-financial assets (+)
552.6
605.3
644.7
642.3
623.0
598.2
575.1
557.2
Consumption of fixed capital (-)
326.0
345.2
366.0
384.1
386.5
388.2
389.4
389.8
Main items of financial investment (+)

Short-term
assets
205.4
308.1
423.2
427.4
381.2
290.4
194.7
33.6

Currency and deposits
246.8
284.1
349.8
439.0
398.4
335.6
256.3
121.8

Money market fund shares
-21.4
1.4
38.3
-13.1
1.8
-17.1
-22.0
-43.1
Debt
securities
2)
-20.0
22.6
35.1
1.5
-19.0
-28.0
-39.5
-45.1
Long-term
assets
412.8
336.8
153.0
39.4
72.8
171.7
302.9
449.7
Deposits
-7.6
1.9
-31.1
-27.4
-13.7
15.7
55.1
88.1
Debt
securities
-2.6
56.1
45.4
56.2
43.2
25.6
27.4
14.8

Shares and other equity
130.2
-19.4
-83.4
-115.9
-90.2
-33.5
28.1
96.1

Quoted and unquoted shares and other equity
63.2
-4.5
-4.5
12.1
25.2
39.0
47.5
42.7

Mutual fund shares
67.0
-14.9
-78.8
-128.0
-115.4
-72.5
-19.4
53.4

Life insurance and pension fund reserves
292.7
298.2
222.2
126.6
133.5
163.8
192.3
250.7
Main items of financing (-)

Loans
398.9
395.2
356.9
206.1
154.8
126.0
98.5
98.3

of which: From euro area MFIs
358.5
349.0
283.7
82.8
20.1
10.3
-15.8
63.1
Other changes in financial assets (+)

Shares and other equity
473.3
468.3
55.6
-1,407.7
-1,069.6
-628.3
-61.1
335.5
Life insurance and pension fund reserves
109.5
46.7
25.1
-252.6
-201.2
-99.6
55.5
152.9
Remaining net flows (+)
-10.5
-58.6
-47.7
-64.7
-85.7
-2.0
38.0
52.6
= Changes in net worth 1)
1,018.1
966.1
531.1
-1,206.1
-820.7
-183.8
617.2
1,093.4
Financial balance sheet

Financial assets (+)

Short-term
assets
4,478.6
4,744.5
5,199.8
5,698.3
5,772.1
5,787.1
5,745.9
5,731.7

Currency and deposits
4,173.7
4,453.9
4,842.8
5,314.4
5,375.7
5,431.0
5,397.6
5,468.3

Money market fund shares
291.2
252.7
289.4
317.2
342.3
310.9
307.6
243.6
Debt
securities
2)
13.6
37.9
67.6
66.7
54.0
45.2
40.7
19.8
Long-term
assets
11,075.6
11,988.0
12,168.2
10,452.6
10,184.5
10,638.6
11,225.5
11,439.1
Deposits
998.8
1,009.8
943.4
883.7
859.4
878.4
907.7
949.5
Debt
securities
1,238.8
1,306.6
1,332.1
1,366.7
1,337.7
1,372.7
1,438.6
1,421.7

Shares and other equity
4,570.6
5,059.3
5,033.1
3,468.6
3,243.7
3,507.9
3,836.4
3,930.7

Quoted and unquoted shares and other equity
3,234.3
3,641.6
3,674.1
2,488.1
2,309.3
2,497.0
2,767.2
2,785.4

Mutual fund shares
1,336.2
1,417.7
1,359.1
980.5
934.4
1,010.9
1,069.2
1,145.3

Life insurance and pension fund reserves
4,267.4
4,612.3
4,859.6
4,733.6
4,743.8
4,879.6
5,042.8
5,137.1
Remaining net assets (+)
270.8
241.9
211.7
228.5
211.1
238.3
218.7
212.6
Liabilities (-)

Loans
4,766.1
5,165.6
5,510.9
5,708.0
5,701.9
5,739.4
5,762.9
5,804.8

of which: From euro area MFIs
4,201.0
4,553.1
4,825.5
4,901.1
4,878.7
4,899.0
4,916.2
4,956.0
= Net financial wealth
11,058.9
11,808.8
12,068.8
10,671.4
10,465.8
10,924.5
11,427.3
11,578.7
Sources: ECB and Eurostat.
1) Excluding changes in net worth which are due to other changes in non-financial assets, such as revaluations of residential property.
2) Securities issued by MFIs with a maturity of less than two years and securities issued by other sectors with a maturity of less than one year.
ECB
S Monthly Bulletin
32 July 2010

EURO AREA
STATISTICS
Euro area
accounts
3.4 Non-financial corporations
(EUR billions; four-quarter cumulated flows; outstanding amounts at end of period)
2008 Q1-
2008 Q2-
2008 Q3-
2008 Q4-
2009 Q1-
2005
2006
2007
2008 Q4
2009 Q1
2009 Q2
2009 Q3
2009 Q4
Income and saving

Gross value added (basic prices) (+)
4,163.1
4,369.3
4,620.3
4,750.3
4,693.1
4,612.1
4,556.3
4,528.4
Compensation of employees (-)
2,471.3
2,583.9
2,713.6
2,831.9
2,828.1
2,818.6
2,802.5
2,787.2
Other taxes less subsidies on production (-)
72.8
75.4
80.3
76.1
74.0
68.9
64.2
59.1
= Gross operating surplus (+)
1,619.0
1,710.0
1,826.4
1,842.2
1,791.0
1,724.6
1,689.6
1,682.1
Consumption of fixed capital (-)
670.5
701.9
738.6
774.2
780.2
783.6
786.2
788.6
= Net operating surplus (+)
948.4
1,008.1
1,087.8
1,068.1
1,010.8
941.0
903.4
893.5

Property income receivable (+)
433.8
506.0
574.0
594.1
570.8
536.6
507.7
478.6
Interest
receivable
141.3
169.7
198.9
223.8
211.8
194.9
174.3
157.0

Other property income receivable
292.5
336.3
375.1
370.3
358.9
341.6
333.4
321.7

Interest and rents payable (-)
236.1
284.0
345.7
400.1
381.4
350.5
310.7
274.2

= Net entrepreneurial income (+)
1,146.1
1,230.1
1,316.1
1,262.1
1,200.2
1,127.0
1,100.5
1,097.9

Distributed income (-)
857.5
926.2
987.4
1,030.3
1,018.2
976.1
941.3
917.2

Taxes on income and wealth payable (-)
149.1
189.8
211.9
193.5
186.5
165.8
144.8
131.6

Social contributions receivable (+)
72.8
74.9
63.7
66.0
65.6
65.6
65.5
65.6

Social benefits payable (-)
60.7
60.6
62.0
63.5
63.7
64.0
64.3
64.4

Other net transfers (-)
61.4
65.8
56.6
58.9
58.3
58.5
59.5
60.4

= Net saving
90.1
62.5
62.0
-18.2
-60.9
-71.8
-43.9
-10.1
Investment, financing and saving

Net acquisition of non-financial assets (+)
253.0
311.7
363.9
354.3
298.2
212.9
149.8
95.4
Gross fixed capital formation (+)
915.9
989.9
1,077.1
1,095.1
1,059.7
1,006.9
967.6
942.2
Consumption of fixed capital (-)
670.5
701.9
738.6
774.2
780.2
783.6
786.2
788.6
Net acquisition of other non-financial assets (+)
7.7
23.8
25.4
33.4
18.7
-10.3
-31.6
-58.2
Main items of financial investment (+)

Short-term
assets
128.5
159.8
168.4
61.7
3.7
35.0
81.0
114.5

Currency and deposits
113.8
146.1
154.4
13.7
-6.4
10.2
37.7
90.0

Money market fund shares
7.4
2.3
-19.2
28.7
29.1
36.4
41.9
42.6
Debt
securities
1)
7.4
11.5
33.2
19.3
-19.0
-11.5
1.3
-18.1
Long-term
assets
390.4
517.6
736.0
663.1
685.5
561.3
413.4
207.2
Deposits
31.8
24.0
-25.6
22.6
36.5
39.7
11.9
-2.1
Debt
securities
-34.4
14.0
-32.4
-71.5
-3.0
17.2
-6.4
-6.2

Shares and other equity
234.2
285.4
446.9
365.7
376.1
340.8
283.7
137.5

Other (mainly intercompany loans)
158.8
194.3
347.2
346.2
275.9
163.6
124.2
78.1
Remaining net assets (+)
87.8
117.4
110.1
53.2
-102.6
-75.8
-76.6
-54.4
Main items of financing (-)

Debt
432.7
732.4
843.0
760.7
575.7
405.7
230.4
82.5

of which: Loans from euro area MFIs
276.7
449.0
544.2
392.6
252.0
98.2
-35.0
-151.4

of which: Debt securities
14.0
40.0
33.5
62.6
67.5
79.2
92.2
76.9
Shares and other equity
275.9
238.8
404.7
311.1
287.6
317.3
297.5
206.2
Quoted
shares
101.7
38.1
70.4
2.5
13.2
47.1
57.9
58.6

Unquoted shares and other equity
174.2
200.7
334.2
308.5
274.4
270.2
239.5
147.6
Net capital transfers receivable (-)
60.6
72.3
69.8
76.3
78.8
77.4
78.3
81.0
= Net saving
90.1
62.5
62.0
-18.2
-60.9
-71.8
-43.9
-10.1
Financial balance sheet

Financial assets

Short-term
assets
1,509.3
1,675.1
1,827.7
1,889.0
1,876.5
1,908.3
1,957.9
1,999.2

Currency and deposits
1,229.6
1,367.3
1,507.7
1,537.6
1,510.0
1,551.2
1,579.5
1,634.1

Money market fund shares
173.4
181.4
157.4
182.2
208.1
213.6
220.4
206.5
Debt
securities
1)
106.3
126.4
162.6
169.2
158.4
143.6
158.0
158.6
Long-term
assets
8,809.7
10,197.0
11,102.2
9,365.6
9,098.1
9,494.4
10,149.1
10,452.8
Deposits
107.9
151.8
156.0
173.6
173.9
162.4
152.6
150.3
Debt
securities
282.4
296.9
262.7
177.5
181.9
157.7
153.2
186.3

Shares and other equity
6,432.5
7,564.1
8,178.4
6,160.1
5,838.3
6,280.5
6,926.4
7,174.9

Other (mainly intercompany loans)
1,986.9
2,184.1
2,505.2
2,854.4
2,904.0
2,893.9
2,917.0
2,941.3
Remaining net assets
335.8
352.9
385.2
461.1
448.8
479.6
503.2
497.2
Liabilities

Debt
7,195.5
7,892.8
8,633.5
9,381.1
9,414.3
9,450.5
9,457.7
9,466.3

of which: Loans from euro area MFIs
3,524.3
3,981.9
4,507.1
4,895.6
4,859.3
4,825.9
4,759.4
4,708.9

of which: Debt securities
667.1
686.4
684.1
739.6
736.6
771.2
816.9
821.1
Shares and other equity
11,206.7
13,218.6
14,408.5
10,616.8
9,955.0
10,688.9
11,849.0
12,163.0
Quoted
shares
3,721.5
4,533.5
5,023.9
2,850.0
2,483.7
2,827.6
3,299.0
3,429.7

Unquoted shares and other equity
7,485.1
8,685.0
9,384.6
7,766.9
7,471.3
7,861.3
8,549.9
8,733.4
Sources: ECB and Eurostat.
1) Securities issued by MFIs with a maturity of less than two years and securities issued by other sectors with a maturity of less than one year.
ECB
Monthly Bulletin
July 2010 S 33

3.5 Insurance corporations and pension funds
(EUR billions; four-quarter cumulated flows; outstanding amounts at end of period)
2008 Q1-
2008 Q2-
2008 Q3-
2008 Q4-
2009 Q1-
2005
2006
2007
2008 Q4
2009 Q1
2009 Q2
2009 Q3
2009 Q4
Financial account, financial transactions

Main items of financial investment (+)

Short-term
assets
22.9
64.4
69.2
116.5
69.7
54.6
41.8
22.6

Currency and deposits
7.2
11.0
6.5
57.0
18.4
11.8
-0.7
-33.2

Money market fund shares
-0.9
3.4
2.8
20.7
18.6
12.1
7.0
9.0
Debt
securities
1)
16.6
49.9
59.9
38.8
32.7
30.6
35.5
46.7
Long-term
assets
290.8
293.7
169.9
67.8
49.7
81.6
112.1
178.4
Deposits
16.7
68.4
48.8
-4.7
8.0
9.1
17.2
15.2
Debt
securities
132.9
111.5
48.8
33.5
52.8
7.6
12.8
49.1
Loans
-0.5
-1.3
-15.6
21.8
-2.1
10.3
7.9
5.3
Quoted
shares
31.3
-2.5
-0.4
-15.2
-20.2
-22.7
-96.9
-84.0

Unquoted shares and other equity
19.0
29.5
22.0
23.3
16.1
11.1
2.4
-5.8

Mutual fund shares
91.5
88.2
66.4
9.2
-4.9
66.3
168.8
198.6
Remaining net assets (+)
-0.7
9.6
-11.5
19.6
8.3
31.2
30.4
32.6
Main items of financing (-)

Debt
securities
-0.4
5.7
3.0
11.7
13.8
9.9
10.0
0.8
Loans
12.8
44.9
-5.3
24.3
-2.3
12.3
5.9
-28.3
Shares and other equity
10.5
9.2
1.7
0.1
1.5
2.3
4.4
4.3
Insurance technical reserves
340.4
307.5
242.3
133.1
117.8
147.8
174.0
258.9

Net equity of households in life insurance and pension fund reserves
296.4
301.0
239.1
129.5
122.5
151.7
178.4
250.1

Prepayments of insurance premiums and reserves for

outstanding
claims
44.0
6.5
3.2
3.6
-4.6
-3.9
-4.4
8.8
= Changes in net financial worth due to transactions
-50.3
0.5
-14.2
34.6
-3.1
-4.9
-10.0
-2.2
Other changes account

Other changes in financial assets (+)

Shares and other equity
197.7
178.8
17.6
-564.7
-433.5
-280.2
-57.6
176.3
Other net assets
60.9
-39.8
-39.7
35.8
30.0
51.5
95.4
91.2
Other changes in liabilities (-)

Shares and other equity
123.0
41.4
-33.3
-179.1
-187.8
-123.2
-53.4
14.2
Insurance technical reserves
144.7
55.1
27.6
-248.8
-203.9
-97.6
65.9
163.2

Net equity of households in life insurance and pension fund reserves
153.8
51.3
27.7
-249.3
-197.9
-93.9
65.5
166.3

Prepayments of insurance premiums and reserves for

outstanding
claims
-9.1
3.8
-0.1
0.5
-6.0
-3.7
0.3
-3.1
= Other changes in net financial worth
-9.2
42.5
-16.5
-101.0
-11.9
-7.9
25.4
90.1
Financial balance sheet

Financial assets (+)

Short-term
assets
430.4
503.0
566.2
688.4
709.9
709.1
695.7
720.2

Currency and deposits
146.6
157.1
163.6
224.5
213.2
196.1
190.3
195.2

Money market fund shares
74.3
80.1
80.7
98.8
112.3
104.2
103.2
99.1
Debt
securities
1)
209.5
265.8
321.9
365.2
384.4
408.8
402.2
425.9
Long-term
assets
4,715.6
5,125.4
5,273.9
4,796.8
4,749.6
4,909.8
5,122.6
5,249.1
Deposits
519.8
589.8
638.8
636.1
649.4
651.6
655.4
651.5
Debt
securities
1,801.1
1,853.9
1,859.5
1,909.3
1,948.1
1,928.2
2,003.9
2,047.6
Loans
411.4
406.9
393.1
413.8
414.6
419.5
419.3
418.5
Quoted
shares
634.5
718.1
713.2
417.1
374.9
436.9
409.7
416.7

Unquoted shares and other equity
414.4
487.8
527.2
445.4
417.2
416.1
437.7
438.7

Mutual fund shares
934.4
1,068.9
1,142.2
975.1
945.5
1,057.4
1,196.6
1,276.1
Remaining net assets (+)
182.6
212.6
193.1
235.5
236.6
250.7
257.5
254.8
Liabilities (-)

Debt
securities
21.3
35.9
29.3
46.0
44.9
44.8
48.7
50.2
Loans
201.1
242.8
233.9
265.7
268.4
268.2
256.6
236.3
Shares and other equity
629.8
680.3
648.7
469.8
410.3
436.3
489.2
488.3
Insurance technical reserves
4,597.0
4,959.6
5,229.5
5,113.8
5,116.7
5,260.4
5,430.7
5,536.0

Net equity of households in life insurance and pension fund reserves
3,910.9
4,263.2
4,530.0
4,410.2
4,417.1
4,557.4
4,724.2
4,826.6

Prepayments of insurance premiums and reserves

for outstanding claims
686.1
696.3
699.5
703.6
699.6
703.0
706.5
709.4
= Net financial wealth
-120.6
-77.6
-108.3
-174.6
-144.3
-140.1
-149.3
-86.7
Source: ECB.
1) Securities issued by MFIs with a maturity of less than two years and securities issued by other sectors with a maturity of less than one year.
ECB
S Monthly Bulletin
34 July 2010

FINANCIAL MARKETS
4
4.1 Securities other than shares by original maturity, residency of the issuer and currency
(EUR billions and period growth rates; seasonally adjusted; transactions during the month and end-of-period outstanding amounts; nominal values)

By euro area residents
Total in euro 1)

In euro
In all currencies

Outstanding Gross issues
Net issues Outstanding Gross issues
Net issues Outstanding Gross issues
Net issues
Annual Seasonally adjusted 2)
amounts
amounts
amounts
growth rates
6-month
Net issues growth rates
1
2
3
4
5
6
7
8
9
10
11
12
Total
2009 Apr.
14,840.8
1,233.9
79.6
12,640.1
1,167.6
102.8
14,048.0
1,248.1
107.1
11.9
89.9
14.2
May
15,050.0
1,160.1
208.7
12,815.5
1,070.8
174.8
14,191.2
1,151.3
176.9
11.9
116.5
12.7
June
15,141.4
1,090.0
90.4
12,877.1
1,007.8
60.4
14,262.6
1,088.0
74.7
11.7
92.9
10.5
July
15,173.1
1,124.2
32.3
12,933.0
1,069.5
56.5
14,330.3
1,148.7
69.0
11.6
104.2
10.4
Aug.
15,224.2
883.1
50.0
12,965.2
827.3
31.2
14,351.6
893.4
24.1
10.8
63.7
8.9
Sep.
15,329.6
965.6
106.1
13,043.7
882.4
79.2
14,420.9
966.2
84.7
11.8
149.9
9.1
Oct.
15,331.1
951.3
1.7
13,073.9
901.7
30.4
14,456.5
973.1
38.5
10.9
10.6
7.8
Nov.
15,383.3
889.8
51.4
13,128.3
847.6
53.6
14,515.9
913.4
64.3
9.6
39.3
6.6
Dec.
15,921.3
937.7
-47.6
13,668.2
884.2
-45.8
15,301.3
971.6
-49.5
8.1
22.4
5.3
2010 Jan.
16,005.1
1,089.9
82.5
13,754.3
1,027.3
84.8
15,434.0
1,143.7
105.1
7.7
80.8
4.9
Feb.
16,042.2
870.8
39.0
13,793.0
822.0
40.6
15,480.8
916.5
34.7
6.3
-17.6
3.7
Mar.
16,197.7
1,031.0
154.0
13,906.5
927.1
111.9
15,608.0
1,039.1
120.4
6.0
111.2
3.1

Apr.
.
.
.
13,962.1
943.7
54.0
15,695.7
1,052.9
74.9
5.7
60.3
3.7
Long-term
2009 Apr.
13,230.8
292.6
78.8
11,142.5
257.8
71.2
12,350.5
276.6
72.4
10.1
69.8
13.5
May
13,435.1
339.3
204.9
11,313.7
281.4
172.0
12,501.7
301.9
179.4
10.4
116.1
12.9
June
13,556.9
314.2
119.7
11,423.6
275.6
107.4
12,633.6
309.5
130.2
10.6
102.5
11.7
July
13,584.0
269.2
27.3
11,457.3
247.8
33.9
12,677.2
272.7
44.1
10.6
87.1
11.0
Aug.
13,644.3
131.5
59.9
11,502.4
108.9
44.8
12,719.7
121.8
48.8
10.3
98.6
10.3
Sep.
13,716.4
223.7
71.7
11,576.8
197.1
74.0
12,782.0
222.6
75.3
11.3
124.4
10.0
Oct.
13,782.6
245.1
64.2
11,639.0
216.7
60.1
12,845.3
236.1
66.7
11.6
61.5
9.8
Nov.
13,866.1
200.9
81.5
11,718.4
180.1
77.3
12,922.1
195.3
81.7
10.7
46.9
8.6
Dec.
14,387.1
170.5
-19.8
12,249.2
155.0
-10.0
13,676.6
167.0
-19.9
9.1
-23.2
6.2
2010 Jan.
14,468.0
309.3
81.1
12,323.5
277.8
74.4
13,793.3
315.5
92.7
9.0
138.9
6.8
Feb.
14,523.2
211.4
57.4
12,385.3
192.9
63.9
13,865.0
210.8
60.1
7.9
18.2
5.5
Mar.
14,669.7
308.8
145.1
12,506.7
248.8
120.1
13,997.0
280.2
126.9
7.7
132.9
5.4

Apr.
.
.
.
12,559.9
219.1
50.3
14,079.7
250.5
69.1
7.6
66.5
5.4
C15 Total outstanding amounts and gross issues of securities other than shares issued by euro area residents
(EUR billions)
total gross issues (right-hand scale)
total outstanding amounts (left-hand scale)
outstanding amounts in euro (left-hand scale)
18000
1600
16000
1400
14000
1200
12000
1000
10000
800
8000
600
6000
400
4000
200
2000
0
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
Sources: ECB and BIS (for issues by non-euro area residents).
1)
Total euro-denominated securities other than shares issued by euro area residents and non-euro area residents.
2)
For details of the calculation of the growth rates, see the Technical Notes. The six-month growth rates have been annualised.
ECB
Monthly Bulletin
July 2010 S 35

4.2 Securities other than shares issued by euro area residents, by sector of the issuer and instrument type
(EUR billions ; transactions during the month and end-of-period outstanding amounts; nominal values)
1. Outstanding amounts and gross issues

Outstanding amounts
Gross issues 1)

Total
MFIs Non-MFI corporations
General government
Total
MFIs Non-MFI corporations
General government
(including
(including
Eurosystem)
Financial Non-financial
Central
Other
Eurosystem)
Financial Non-financial
Central
Other
corporations corporations
government
general
corporations corporations
government
general
other than
government
other than
government
MFIs
MFIs
1
2
3
4
5
6
7
8
9
10
11
12
Total
2008
13,428
5,272
2,170
709
4,938
340
1,177
817
75
100
162
24
2009
15,301
5,379
3,225
814
5,510
373
1,124
738
58
85
221
22
2009 Q2
14,263
5,438
2,355
769
5,349
351
1,162
750
62
90
241
20
Q3
14,421
5,432
2,379
799
5,452
358
1,003
652
43
84
212
12
Q4
15,301
5,379
3,225
814
5,510
373
953
628
49
73
182
20
2010 Q1
15,608
5,471
3,239
854
5,656
389
1,033
653
57
73
230
20
2010 Jan.
15,434
5,434
3,260
823
5,549
368
1,144
722
80
69
259
14
Feb.
15,481
5,418
3,234
841
5,612
375
916
574
35
71
215
22
Mar.
15,608
5,471
3,239
854
5,656
389
1,039
663
56
80
215
25

Apr.
15,696
5,495
3,254
867
5,686
394
1,053
672
56
83
219
23
Short-term
2008
1,595
822
66
116
566
25
961
722
27
92
101
19
2009
1,625
733
75
71
725
21
874
639
14
68
137
15
2009 Q2
1,629
785
44
86
699
16
866
631
14
69
139
13
Q3
1,639
751
35
83
752
19
797
569
10
71
139
8
Q4
1,625
733
75
71
725
21
753
550
14
60
116
13
2010 Q1
1,611
747
63
77
708
17
764
547
24
60
123
10
2010 Jan.
1,641
737
75
74
741
13
828
598
20
61
144
6
Feb.
1,616
734
65
77
723
16
706
499
25
54
115
12
Mar.
1,611
747
63
77
708
17
759
545
26
66
111
12

Apr.
1,616
754
66
78
699
19
802
571
25
68
121
16
Long-term 2)
2008
11,834
4,450
2,104
593
4,371
316
216
95
48
8
61
4
2009
13,677
4,646
3,151
743
4,784
353
250
99
44
16
84
6
2009 Q2
12,634
4,653
2,311
684
4,650
335
296
119
48
21
102
7
Q3
12,782
4,681
2,344
717
4,701
339
206
83
33
14
72
4
Q4
13,677
4,646
3,151
743
4,784
353
199
79
35
13
66
6
2010 Q1
13,997
4,724
3,176
777
4,948
371
269
106
33
13
107
10
2010 Jan.
13,793
4,696
3,185
749
4,808
355
316
124
60
8
115
8
Feb.
13,865
4,684
3,170
764
4,890
358
211
75
10
17
100
10
Mar.
13,997
4,724
3,176
777
4,948
371
280
118
30
14
104
13

Apr.
14,080
4,741
3,188
789
4,987
375
251
101
31
15
97
7

of which: Long-term fixed rate
2008
7,720
2,306
754
455
3,955
250
120
49
9
6
53
3
2009
8,840
2,587
1,033
610
4,338
271
172
60
18
16
74
4
2009 Q2
8,356
2,472
865
548
4,211
260
210
72
23
20
90
5
Q3
8,491
2,507
892
582
4,251
259
139
49
14
13
61
3
Q4
8,840
2,587
1,033
610
4,338
271
132
46
10
12
59
5
2010 Q1
9,101
2,657
1,048
637
4,482
277
185
61
10
12
95
7
2010 Jan.
8,899
2,628
1,043
612
4,347
269
205
81
13
7
100
4
Feb.
8,997
2,628
1,038
625
4,435
271
160
41
4
14
93
8
Mar.
9,101
2,657
1,048
637
4,482
277
191
61
14
13
92
10

Apr.
9,190
2,681
1,056
649
4,525
280
182
65
14
14
87
4

of which: Long-term variable rate
2008
3,601
1,744
1,302
128
363
64
82
36
38
1
5
1
2009
4,399
1,772
2,050
122
374
81
62
28
25
1
6
2
2009 Q2
3,738
1,762
1,402
125
374
74
65
31
24
1
7
2
Q3
3,734
1,747
1,411
125
372
79
49
21
18
1
7
1
Q4
4,399
1,772
2,050
122
374
81
58
26
25
1
5
2
2010 Q1
4,442
1,779
2,059
129
382
93
70
38
20
1
7
3
2010 Jan.
4,446
1,779
2,073
126
382
85
92
34
44
0
8
5
Feb.
4,418
1,766
2,062
129
374
86
40
30
3
3
3
2
Mar.
4,442
1,779
2,059
129
382
93
77
50
14
1
8
4

Apr.
4,441
1,770
2,061
129
387
94
54
29
15
1
7
3

Source: ECB.
1)
Monthly data on gross issues refer to transactions during the month. For the purposes of comparison, quarterly and annual data refer to the respective monthly averages.
2)
The residual difference between total long-term debt securities and fixed and variable rate long-term debt securities consists of zero coupon bonds and revaluation effects.
ECB
S Monthly Bulletin
36 July 2010

EURO AREA
STATISTICS
Financial
markets
4.2 Securities other than shares issued by euro area residents, by sector of the issuer and instrument type
(EUR billions unless otherwise indicated; transactions during the period; nominal values)
2. Net issues

Non-seasonally adjusted 1)
Seasonally adjusted 1)

Total
MFIs Non-MFI corporations
General government
Total
MFIs Non-MFI corporations
General government
(including
(including
Eurosystem)
Financial Non-financial
Central
Other
Eurosystem)
Financial Non-financial
Central
Other
corporations corporations
government
general
corporations corporations
government
general
other than
government
other than
government
MFIs
MFIs
1
2
3
4
5
6
7
8
9
10
11
12
Total
2008
95.0
22.9
34.9
4.3
31.8
1.1
95.7
23.1
34.1
4.4
33.1
1.0
2009
90.2
10.2
22.2
8.6
46.4
2.8
90.1
9.9
21.7
8.4
47.3
2.8
2009 Q2
119.6
22.0
28.1
12.8
53.8
2.8
99.8
21.4
27.9
8.7
39.0
2.8
Q3
59.3
0.3
10.2
11.1
35.4
2.3
105.9
9.8
31.6
13.9
47.1
3.5
Q4
17.8
-21.9
18.4
3.6
12.5
5.1
24.1
-12.2
-16.2
5.7
44.3
2.5
2010 Q1
86.7
25.5
0.0
11.7
46.4
3.1
58.1
7.7
17.6
11.4
17.0
4.5
2010 Jan.
105.1
43.3
25.6
6.2
35.7
-5.6
80.8
19.3
69.5
2.2
-8.9
-1.4
Feb.
34.7
-21.4
-28.1
17.0
60.7
6.6
-17.6
-47.1
-30.6
18.2
34.6
7.3
Mar.
120.4
54.6
2.6
12.0
42.8
8.3
111.2
50.7
13.9
13.9
25.1
7.6

Apr.
74.9
19.3
10.0
11.1
29.0
5.7
60.3
8.5
17.7
7.3
21.7
5.0
Long-term
2008
65.5
16.0
32.8
2.8
13.4
0.6
64.8
16.1
32.0
2.9
13.3
0.5
2009
89.6
15.4
24.3
12.3
34.5
3.1
89.2
15.5
23.7
12.4
34.6
3.1
2009 Q2
127.3
36.4
28.9
17.1
41.3
3.7
96.1
25.7
27.8
13.4
25.7
3.5
Q3
56.1
12.2
13.0
12.0
17.4
1.4
103.3
22.4
34.7
13.9
29.8
2.5
Q4
42.8
-12.6
16.3
7.4
27.3
4.4
28.4
-3.0
-18.1
7.9
38.1
3.5
2010 Q1
93.2
22.2
4.1
9.9
52.8
4.3
96.7
13.5
21.9
11.6
45.4
4.3
2010 Jan.
92.7
41.2
25.3
3.2
20.9
2.1
138.9
43.7
66.3
4.5
22.7
1.7
Feb.
60.1
-18.5
-17.7
13.7
79.5
3.2
18.2
-41.0
-17.9
14.9
57.9
4.3
Mar.
126.9
43.9
4.6
12.7
58.0
7.5
132.9
37.9
17.2
15.4
55.5
6.8

Apr.
69.1
11.0
7.3
9.9
37.6
3.4
66.5
1.4
15.8
8.0
38.9
2.5
C16 Net issues of securities other than shares: seasonally adjusted and non-seasonally adjusted
(EUR billions; transactions during the month; nominal values)
net issues
seasonally adjusted net issues
250
250
200
200
150
150
100
100
50
50
0
0
-50
-50
-100
-100
2003
2004
2005
2006
2007
2008
2009

Source: ECB.
1)
Monthly data on net issues refer to transactions during the month. For the purposes of comparison, quarterly and annual data refer to the respective monthly averages.
ECB
Monthly Bulletin
July 2010 S 37

4.3 Growth rates of securities other than shares issued by euro area residents 1)
(percentage changes)

Annual growth rates (non-seasonally adjusted)
6-month seasonally adjusted growth rates

Total
MFIs Non-MFI corporations
General government
Total
MFIs Non-MFI corporations
General government
(including
(including
Eurosystem)
Financial Non-financial
Central
Other
Eurosystem)
Financial Non-financial
Central
Other
corporations corporations
government
general
corporations corporations
government
general
other than
government
other than
government
MFIs
MFIs
1
2
3
4
5
6
7
8
9
10
11
12
Total
2009 Apr.
11.9
6.2
31.6
10.3
11.7
10.6
14.2
5.9
37.9
15.7
15.1
11.3
May
11.9
5.4
31.1
10.4
12.8
9.5
12.7
5.8
31.7
16.4
13.0
11.9
June
11.7
4.8
28.0
12.3
13.7
9.6
10.5
4.8
21.0
11.9
12.0
9.6
July
11.6
4.2
28.8
14.1
13.5
9.4
10.4
4.8
21.1
15.8
11.0
10.3
Aug.
10.8
3.5
25.1
13.8
13.4
9.0
8.9
3.2
16.8
14.4
10.7
10.8
Sep.
11.8
4.1
25.4
16.2
14.9
10.6
9.1
3.5
16.4
19.2
10.2
11.3
Oct.
10.9
3.0
24.8
17.1
13.6
10.4
7.8
0.2
13.0
18.6
12.1
9.4
Nov.
9.6
2.5
20.0
17.0
12.1
10.6
6.6
-0.6
9.5
17.7
11.3
9.3
Dec.
8.1
2.3
12.0
14.6
11.3
9.7
5.3
-0.3
3.5
16.0
10.7
10.4
2010 Jan.
7.7
2.3
12.1
13.8
10.2
9.1
4.9
0.0
3.7
11.7
9.4
7.8
Feb.
6.3
0.6
8.6
15.1
9.8
10.8
3.7
-1.8
0.9
15.7
8.8
11.0
Mar.
6.0
1.4
7.2
16.1
8.6
11.6
3.1
-0.5
-1.2
13.1
6.9
11.9

Apr.
5.7
1.3
6.2
15.7
8.5
10.9
3.7
2.5
-0.2
13.1
5.0
12.4
Long-term
2009 Apr.
10.1
5.5
32.8
14.8
6.0
8.7
13.5
5.0
42.6
26.2
10.0
11.8
May
10.4
5.1
32.4
16.3
7.2
8.5
12.9
5.7
35.5
30.5
9.1
14.2
June
10.6
4.8
29.6
19.4
8.5
8.4
11.7
5.7
23.9
29.8
9.8
12.6
July
10.6
4.5
31.1
22.0
7.8
8.0
11.0
6.2
22.0
28.1
8.6
12.0
Aug.
10.3
4.8
27.8
21.6
7.8
8.0
10.3
6.8
17.9
24.0
8.3
13.2
Sep.
11.3
5.1
28.1
24.0
9.6
9.3
10.0
6.4
17.7
27.3
7.5
11.4
Oct.
11.6
4.9
27.2
26.0
10.4
10.4
9.8
4.8
13.5
25.9
11.0
9.0
Nov.
10.7
5.0
21.9
27.2
9.6
10.8
8.6
4.4
9.8
24.2
10.1
7.6
Dec.
9.1
4.1
13.5
24.9
9.5
11.8
6.2
2.5
3.9
20.3
9.0
10.9
2010 Jan.
9.0
4.8
12.4
21.9
9.5
11.4
6.8
3.5
3.4
15.9
10.5
10.7
Feb.
7.9
3.4
9.2
21.8
9.7
12.3
5.5
0.0
1.0
19.6
11.2
11.5
Mar.
7.7
3.8
8.0
22.0
9.2
12.7
5.4
1.3
-0.9
16.9
10.9
14.0

Apr.
7.6
3.3
6.9
20.7
10.4
10.9
5.4
1.8
0.7
15.7
9.8
12.6
C17 Annual growth rates of long-term debt securities, by sector of the issuer, in all currencies combined
(annual percentage changes)
general government
MFIs (including Eurosystem)
non-MFI corporations
35
35
30
30
25
25
20
20
15
15
10
10
5
5
0
0
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009

Source: ECB.
1)
For details of the calculation of the growth rates, see the Technical Notes. The six-month growth rates have been annualised.
ECB
S Monthly Bulletin
38 July 2010

EURO AREA
STATISTICS
Financial
markets
4.3 Growth rates of securities other than shares issued by euro area residents 1) (cont'd)
(percentage changes)

Long-term fixed rate
Long-term variable rate

Total
MFIs Non-MFI corporations
General government
Total
MFIs Non-MFI corporations
General government
(including
(including
Eurosystem)
Financial Non-financial
Central
Other
Eurosystem)
Financial Non-financial
Central
Other
corporations corporations
government
general
corporations corporations
government
general
other than
government
other than
government
MFIs
MFIs
13
14
15
16
17
18
19
20
21
22
23
24
In all currencies combined
2008
3.1
4.9
5.7
4.9
1.5
1.4
12.8
5.4
33.4
7.0
7.6
3.2

2009
9.5
7.0
18.2
24.0
8.1
4.2
12.2
1.9
36.2
-1.9
0.1
20.7
2009 Q2
8.9
6.8
17.9
21.2
7.5
4.8
14.4
3.1
43.2
-1.1
-0.6
19.9
Q3
10.5
7.2
21.2
28.2
9.0
3.9
11.4
1.0
35.5
-3.2
-1.6
25.1

Q4
12.2
9.0
21.4
33.5
10.3
6.6
7.7
-1.6
24.4
-4.1
2.0
26.2
2010 Q1
11.1
9.7
14.1
27.9
9.6
8.1
2.4
-3.8
8.6
-2.3
4.6
26.7
2009 Nov.
12.4
9.5
21.7
34.9
10.1
7.1
7.0
-1.7
22.4
-3.9
1.7
25.8
Dec.
11.9
9.7
19.3
32.3
9.7
8.3
2.8
-3.9
10.8
-4.2
3.0
25.2
2010 Jan.
11.5
10.7
16.2
27.7
9.3
7.0
3.5
-3.2
10.1
-3.2
7.3
28.2
Feb.
10.8
9.0
11.6
26.8
10.0
8.3
1.6
-4.4
7.4
-1.5
3.2
27.1
Mar.
10.4
9.1
10.2
26.4
9.4
9.5
1.4
-3.6
5.9
0.0
3.5
24.4

Apr.
10.7
8.9
8.4
24.8
10.7
7.8
0.9
-4.5
4.8
-0.3
7.6
22.1
In euro
2008
3.0
4.8
6.1
3.0
1.7
1.3
14.3
6.6
35.1
7.2
7.9
2.0

2009
10.0
8.9
21.4
22.5
8.2
3.6
14.5
3.9
38.7
-2.5
-0.4
21.8
2009 Q2
9.6
8.8
21.8
19.5
7.7
4.2
17.2
5.4
46.3
-1.8
-0.7
21.7
Q3
11.2
9.4
24.4
27.2
9.2
3.3
13.7
2.9
38.1
-3.8
-2.4
27.4

Q4
12.8
11.3
23.5
33.1
10.4
6.1
9.2
-0.1
25.9
-4.9
0.7
26.8
2010 Q1
11.4
10.7
15.3
28.8
9.7
7.8
3.0
-3.3
9.4
-2.5
3.2
26.7
2009 Nov.
12.9
11.9
23.6
34.4
10.2
6.8
8.3
-0.5
23.8
-4.5
0.4
25.9
Dec.
12.2
11.2
20.5
33.0
9.8
8.0
3.7
-3.0
11.9
-4.7
1.7
25.1
2010 Jan.
11.7
11.7
17.8
28.4
9.3
6.6
4.1
-2.8
11.0
-3.7
5.9
28.3
Feb.
11.1
9.9
12.5
27.8
10.1
8.0
2.1
-4.1
8.1
-1.7
1.8
27.0
Mar.
10.7
9.7
11.4
27.4
9.4
9.4
1.9
-3.3
6.5
0.3
2.1
24.5

Apr.
10.8
9.1
8.8
25.9
10.7
7.5
1.3
-4.0
4.9
-0.3
6.3
22.0
C18 Annual growth rates of short-term debt securities, by sector of the issuer, in all currencies combined
(annual percentage changes)
general government
MFIs (including Eurosystem)
non-MFI corporations
80
80
60
60
40
40
20
20
0
0
-20
-20
-40
-40
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009

Source: ECB.
1)
Annual percentage changes for monthly data refer to the end of the month, whereas those for quarterly and yearly data refer to the annual change in the period average.

See the Technical Notes for details.
ECB
Monthly Bulletin
July 2010 S 39

4.4 Quoted shares issued by euro area residents 1)
(EUR billions, unless otherwise indicated; market values)
1. Outstanding amounts and annual growth rates
(outstanding amounts as at end of period)

Total
MFIs
Financial corporations other than MFIs
Non-financial corporations
Total
Index:
Annual
Total
Annual
Total
Annual
Total
Annual
Dec. 2001 = 100
growth
growth
growth
growth
rates (%)
rates (%)
rates (%)
rates (%)
1
2
3
4
5
6
7
8
9
2008 Apr.
5,766.6
104.5
1.0
838.5
1.3
519.6
2.4
4,408.5
0.7
May
5,747.7
104.5
0.9
772.3
1.8
497.1
2.5
4,478.4
0.6
June
5,100.2
104.5
0.6
666.5
1.8
435.8
2.5
3,997.9
0.2
July
4,991.5
104.7
0.6
692.8
2.7
428.2
2.5
3,870.5
0.0
Aug.
5,017.9
104.6
0.7
666.7
2.8
438.4
2.7
3,912.7
0.0
Sep.
4,448.1
104.7
0.7
613.3
3.6
382.3
2.6
3,452.5
0.0
Oct.
3,760.0
105.0
0.7
452.9
4.2
280.5
2.8
3,026.6
-0.1
Nov.
3,504.9
105.2
0.9
395.6
5.9
265.4
2.3
2,843.9
-0.1
Dec.
3,512.7
105.4
1.0
378.1
5.8
282.5
2.7
2,852.1
-0.1
2009 Jan.
3,315.7
105.6
1.1
343.7
7.4
259.0
2.8
2,712.9
-0.1
Feb.
2,943.5
105.6
1.1
275.9
7.3
206.3
2.8
2,461.3
-0.1
Mar.
3,027.4
106.1
1.5
315.5
7.9
223.9
2.9
2,488.0
0.4
Apr.
3,461.0
106.2
1.6
413.7
8.2
274.6
3.0
2,772.7
0.5
May
3,609.3
106.5
1.9
454.1
8.9
283.3
2.9
2,871.9
0.8
June
3,560.2
107.3
2.7
449.5
9.8
279.4
3.9
2,831.4
1.5
July
3,846.1
107.5
2.7
510.4
9.5
301.1
3.6
3,034.6
1.6
Aug.
4,044.3
107.5
2.7
573.3
9.4
321.7
4.0
3,149.3
1.6
Sep.
4,213.9
107.6
2.8
594.0
8.4
351.6
4.1
3,268.3
1.8
Oct.
4,068.7
107.8
2.7
569.0
9.0
326.2
1.3
3,173.6
1.9
Nov.
4,082.3
108.1
2.7
568.5
8.8
317.9
2.2
3,195.9
1.9
Dec.
4,428.9
108.5
3.0
572.1
9.1
348.8
5.3
3,508.0
1.8
2010 Jan.
4,261.5
108.7
2.9
522.5
8.3
338.7
5.3
3,400.3
1.9
Feb.
4,179.3
108.7
3.0
503.6
8.2
337.2
5.4
3,338.4
2.0
Mar.
4,492.7
109.0
2.8
548.3
7.4
363.3
5.4
3,581.1
1.8

Apr.
4,427.9
109.0
2.7
512.7
7.0
343.8
5.3
3,571.4
1.7
C19 Annual growth rates for quoted shares issued by euro area residents
(annual percentage changes)
MFIs
financial corporations other than MFIs
non-financial corporations
12.0
12.0
10.0
10.0
8.0
8.0
6.0
6.0
4.0
4.0
2.0
2.0
0.0
0.0
-2.0
-2.0
-4.0
-4.0
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
Source: ECB.
1)
For details of the calculation of the index and the growth rates, see the Technical Notes.
ECB
S Monthly Bulletin
40 July 2010

EURO AREA
STATISTICS
Financial
markets
4.4 Quoted shares issued by euro area residents 1)
(EUR billions; market values)
2. Transactions during the month

Total
MFIs
Financial corporations other than MFIs
Non-financial corporations
Gross issues Redemptions
Net issues Gross issues Redemptions
Net issues Gross issues Redemptions
Net issues Gross issues Redemptions
Net issues
1
2
3
4
5
6
7
8
9
10
11
12
2008 Apr.
2.1
3.0
-0.9
1.1
0.0
1.1
0.1
0.5
-0.3
0.8
2.5
-1.7
May
7.3
6.0
1.4
4.1
0.1
4.1
1.5
0.3
1.2
1.7
5.6
-3.9
June
3.9
4.8
-0.9
1.3
0.0
1.3
0.5
0.1
0.4
2.1
4.7
-2.6
July
12.7
3.4
9.4
6.7
0.0
6.7
1.5
0.5
1.0
4.5
2.9
1.6
Aug.
1.6
3.0
-1.4
0.3
0.0
0.3
0.1
0.0
0.1
1.1
3.0
-1.9
Sep.
7.8
2.9
5.0
7.0
0.0
7.0
0.0
0.1
-0.1
0.8
2.8
-2.0
Oct.
12.9
0.6
12.2
1.4
0.0
1.4
10.7
0.0
10.7
0.8
0.6
0.1
Nov.
10.6
2.9
7.7
8.4
0.5
8.0
0.5
2.1
-1.6
1.7
0.3
1.4
Dec.
8.5
2.6
6.0
0.0
0.0
0.0
0.5
0.0
0.4
8.0
2.5
5.5
2009 Jan.
6.3
0.5
5.8
5.7
0.0
5.7
0.1
0.0
0.0
0.5
0.4
0.1
Feb.
0.2
0.9
-0.7
0.0
0.0
0.0
0.0
0.1
-0.1
0.2
0.8
-0.6
Mar.
13.7
0.2
13.4
3.6
0.0
3.6
0.2
0.0
0.1
9.9
0.2
9.7
Apr.
3.7
0.3
3.4
1.2
0.0
1.2
0.1
0.0
0.0
2.4
0.3
2.1
May
11.4
0.3
11.1
4.4
0.0
4.4
0.2
0.0
0.1
6.8
0.3
6.5
June
27.8
2.0
25.8
4.8
0.0
4.8
3.3
0.3
3.0
19.7
1.8
18.0
July
7.2
0.2
7.0
3.0
0.0
3.0
0.0
0.0
0.0
4.1
0.2
4.0
Aug.
4.0
3.3
0.7
0.0
0.0
0.0
1.3
0.0
1.3
2.7
3.3
-0.6
Sep.
5.0
0.3
4.7
0.6
0.0
0.6
0.2
0.0
0.1
4.2
0.2
3.9
Oct.
7.7
0.3
7.4
4.5
0.0
4.5
0.1
0.0
0.1
3.1
0.2
2.8
Nov.
11.6
0.2
11.4
9.0
0.0
9.0
1.0
0.0
1.0
1.6
0.2
1.4
Dec.
16.2
0.2
16.1
1.9
0.0
1.9
10.4
0.1
10.3
4.0
0.1
3.9
2010 Jan.
6.4
0.0
6.4
4.1
0.0
4.1
0.1
0.0
0.1
2.3
0.0
2.3
Feb.
2.2
0.3
1.9
0.0
0.0
0.0
0.2
0.0
0.2
2.0
0.3
1.7
Mar.
9.6
0.2
9.4
2.6
0.0
2.6
0.1
0.0
0.1
6.9
0.2
6.7

Apr.
1.8
0.4
1.5
0.1
0.0
0.0
0.0
0.0
0.0
1.8
0.3
1.5
C20 Gross issues of quoted shares by sector of the issuer
(EUR billions; transactions during the month; market values)
non-financial corporations
MFIs
financial corporations other than MFIs
40
40
35
35
30
30
25
25
20
20
15
15
10
10
5
5
0
0
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
Source: ECB.
1)
For details of the calculation of the index and the growth rates, see the Technical Notes.
ECB
Monthly Bulletin
July 2010 S 41

4.5 MFI interest rates on euro-denominated deposits from and loans to euro area residents 1)
(percentages per annum; outstanding amounts as at end of period, new business as period average, unless otherwise indicated)
1. Interest rates on deposits (new business)

Deposits from households
Deposits from non-financial corporations
Repos

Overnight 2)
With an agreed maturity of:
Redeemable at notice of: 2), 3) Overnight 2)
With an agreed maturity of:
Up to 1 year
Over 1 and
Over 2 years
Up to 3 months Over 3 months
Up to 1 year
Over 1 and
Over 2 years
up to 2 years
up to 2 years
1
2
3
4
5
6
7
8
9
10
11
2009 June
0.56
1.86
2.38
2.57
1.95
3.52
0.63
1.04
2.17
2.58
0.93
July
0.52
1.86
2.41
2.61
1.86
3.38
0.57
0.82
2.41
2.92
0.68
Aug.
0.50
1.72
2.32
2.64
1.64
3.23
0.54
0.71
2.06
2.93
0.57
Sep.
0.49
1.61
2.27
2.52
1.60
3.12
0.52
0.69
2.10
2.74
0.58
Oct.
0.46
1.68
2.11
2.55
1.55
2.97
0.49
0.66
1.99
2.72
0.56
Nov.
0.46
1.67
2.23
2.56
1.52
2.76
0.48
0.70
2.11
2.92
0.58
Dec.
0.45
1.67
2.31
2.40
1.53
2.45
0.47
0.77
2.00
2.53
0.64
2010 Jan.
0.43
1.74
2.33
2.52
1.47
2.23
0.45
0.72
1.95
2.44
0.53
Feb.
0.42
1.75
2.24
2.36
1.45
2.11
0.44
0.73
2.11
2.39
0.53
Mar.
0.42
1.90
2.38
2.24
1.45
2.05
0.44
0.80
2.73
2.34
0.50
Apr.
0.41
2.02
2.64
2.14
1.42
2.01
0.43
0.78
2.78
2.30
0.58

May
0.40
2.04
2.73
2.24
1.40
1.98
0.43
0.77
2.81
2.26
0.52
2. Interest rates on loans to households (new business)

Bank
Consumer credit
Lending for house purchase
Other lending
overdrafts 2)

by initial rate fixation
By initial rate fixation
Annual
By initial rate fixation
Annual

percentage
percentage
Floating rate
Over 1
Over
rate of
Floating rate
Over 1
Over 5
Over
rate of
Floating rate
Over 1
Over
and up to
and up to
5 years
charge 4)
and up to
and up to
and up to
10 years
charge 4)
and up to
and up to
5 years
1 year
5 years
1 year
5 years
10 years
1 year
5 years
1
2
3
4
5
6
7
8
9
10
11
12
13
2009 June
9.55
7.26
6.36
8.03
7.83
3.12
4.12
4.51
4.58
4.07
3.55
4.76
4.95
July
9.31
7.63
6.49
8.03
8.02
3.03
4.10
4.54
4.54
4.02
3.35
4.77
4.91
Aug.
9.26
7.93
6.54
7.96
8.17
3.00
4.10
4.54
4.45
4.06
3.24
4.74
4.82
Sep.
9.26
7.69
6.45
7.91
8.00
2.81
4.05
4.48
4.45
3.92
3.13
4.66
4.74
Oct.
9.16
7.32
6.38
7.94
7.87
2.77
4.02
4.45
4.40
3.85
3.21
4.73
4.72
Nov.
9.07
7.03
6.29
7.87
7.76
2.71
3.97
4.46
4.32
3.78
3.16
4.57
4.66
Dec.
8.99
6.42
6.26
7.56
7.43
2.71
3.96
4.42
4.26
3.81
3.08
4.40
4.35
2010 Jan.
8.94
6.83
6.42
8.04
7.86
2.71
3.94
4.38
4.26
3.79
3.13
4.45
4.46
Feb.
9.01
6.72
6.25
7.98
7.78
2.68
3.83
4.32
4.18
3.74
3.17
4.48
4.74
Mar.
8.82
6.35
6.21
7.94
7.59
2.63
3.72
4.21
4.15
3.66
3.05
4.61
4.55
Apr.
8.77
6.83
6.15
7.92
7.69
2.62
3.70
4.18
4.12
3.67
3.06
4.32
4.53

May
8.78
6.76
6.17
7.84
7.65
2.58
3.65
4.14
4.01
3.58
3.09
4.45
4.50
3. Interest rates on loans to non-financial corporations (new business)

Bank
Other loans of up to EUR 1 million
Other loans of over EUR 1 million
overdrafts 2)
by initial rate fixation
by initial rate fixation
Floating rate and
Over 1 and
Over 5 years
Floating rate and
Over 1 and
Over 5 years
up to 1 year
up to 5 years
up to 1 year
up to 5 years
1
2
3
4
5
6
7
2009 June
4.55
3.64
4.85
4.49
2.57
3.08
3.71
July
4.34
3.56
4.78
4.32
2.37
2.89
3.90
Aug.
4.23
3.42
4.67
4.24
2.30
2.80
3.83
Sep.
4.25
3.36
4.54
4.16
2.06
2.89
3.64
Oct.
4.18
3.33
4.49
4.18
2.14
2.73
3.64
Nov.
4.11
3.34
4.49
4.10
2.22
2.74
3.80
Dec.
4.06
3.28
4.22
3.96
2.19
3.15
3.58
2010 Jan.
4.05
3.25
4.20
3.99
2.02
2.88
3.65
Feb.
4.03
3.25
4.22
4.05
1.94
2.90
3.61
Mar.
3.98
3.24
4.21
4.00
1.99
2.54
3.44
Apr.
3.98
3.19
4.17
3.90
2.00
2.66
3.45

May
3.97
3.25
4.12
3.86
1.96
2.75
3.41

Source: ECB.
1)
Data refer to the changing composition of the euro area. For further information, see the General Notes.
2)
For this instrument category, new business and outstanding amounts coincide. End of period.
3)
For this instrument category, households and non-financial corporations are merged and allocated to the household sector, since the outstanding amounts of non-financial
corporations are negligible compared with those of the household sector when all participating Member States are combined.
4)
The annual percentage rate of charge covers the total cost of a loan. The total cost comprises both an interest rate component and a component incorporating
other (related) charges, such as the cost of inquiries, administration, preparation of documents and guarantees.
ECB
S Monthly Bulletin
42 July 2010

EURO AREA
STATISTICS
Financial
markets
4.5 MFI interest rates on euro-denominated deposits from and loans to euro area residents 1)
(percentages per annum; outstanding amounts as at end of period, new business as period average, unless otherwise indicated)
4. Interest rates on deposits (outstanding amounts)

Deposits from households
Deposits from non-financial corporations
Repos

Overnight 2)
With an agreed maturity of:
Redeemable at notice of: 2),3) Overnight 2)
With an agreed maturity of:
Up to 2 years
Over 2 years
Up to 3 months
Over 3 months
Up to 2 years
Over 2 years
1
2
3
4
5
6
7
8
9
2009 June
0.56
3.25
3.07
1.95
3.52
0.63
2.19
3.65
1.63
July
0.52
3.07
3.03
1.86
3.38
0.57
1.97
3.52
1.53
Aug.
0.50
2.94
3.01
1.64
3.23
0.54
1.89
3.39
1.53
Sep.
0.49
2.83
3.01
1.60
3.12
0.52
1.80
3.39
1.45
Oct.
0.46
2.64
2.96
1.55
2.97
0.49
1.70
3.34
1.35
Nov.
0.46
2.50
2.95
1.52
2.76
0.48
1.62
3.37
1.28
Dec.
0.45
2.36
2.91
1.53
2.45
0.47
1.56
3.30
1.21
2010 Jan.
0.43
2.20
2.80
1.47
2.23
0.45
1.45
3.23
1.20
Feb.
0.42
2.15
2.84
1.45
2.11
0.44
1.42
3.31
1.20
Mar.
0.42
2.13
2.75
1.45
2.05
0.44
1.38
3.26
1.16
Apr.
0.41
2.13
2.75
1.42
2.01
0.43
1.37
3.24
1.16

May
0.40
2.13
2.71
1.40
1.98
0.43
1.42
3.21
1.14
5. Interest rates on loans (outstanding amounts)

Loans to households
Loans to non-financial corporations

Lending for house purchase
Consumer credit and other loans
With a maturity of:
with a maturity of:
with a maturity of:

Up to 1 year
Over 1 and
Over 5 years
Up to 1 year
Over 1 and
Over 5 years
Up to 1 year
Over 1 and
Over 5 years
up to 5 years
up to 5 years
up to 5 years
1
2
3
4
5
6
7
8
9
2009 June
4.50
4.40
4.46
7.97
6.91
5.79
3.91
3.71
4.00
July
4.31
4.31
4.36
7.82
6.79
5.70
3.72
3.59
3.81
Aug.
4.23
4.25
4.28
7.82
6.74
5.65
3.65
3.50
3.73
Sep.
4.18
4.26
4.25
7.80
6.71
5.63
3.62
3.43
3.68
Oct.
4.05
4.19
4.18
7.69
6.66
5.54
3.56
3.37
3.60
Nov.
4.01
4.15
4.12
7.56
6.66
5.51
3.53
3.36
3.57
Dec.
4.07
4.11
4.07
7.55
6.57
5.43
3.46
3.35
3.50
2010 Jan.
3.99
4.05
4.00
7.51
6.52
5.38
3.47
3.31
3.45
Feb.
4.04
4.11
4.03
7.49
6.61
5.43
3.45
3.33
3.43
Mar.
3.99
4.04
3.98
7.44
6.51
5.35
3.43
3.26
3.37
Apr.
3.90
4.01
3.92
7.38
6.51
5.30
3.42
3.21
3.33

May
3.88
3.97
3.90
7.40
6.46
5.29
3.40
3.20
3.32
C21 New deposits with an agreed maturity
C22 New loans with a floating rate and up to 1 year's initial
(percentages per annum excluding charges; period averages)
rate fixation (percentages per annum excluding charges; period averages)
by households, up to 1 year
to households for consumption
by non-financial corporations, up to 1 year
to households for house purchase
by households, over 2 years
to non-financial corporations, up to EUR 1 million
by non-financial corporations, over 2 years
to non-financial corporations, over EUR 1 million
5.00
5.00
9.00
9.00
4.50
4.50
8.00
8.00
4.00
4.00
7.00
7.00
3.50
3.50
6.00
6.00
3.00
3.00
5.00
5.00
2.50
2.50
4.00
4.00
2.00
2.00
3.00
3.00
1.50
1.50
1.00
1.00
2.00
2.00
0.50
0.50
1.00
1.00
2003
2004
2005
2006
2007
2008
2009
2003
2004
2005
2006
2007
2008
2009
Source: ECB.
1)
Data refer to the changing composition of the euro area. For further information, see the General Notes.
ECB
Monthly Bulletin
July 2010 S 43

4.6 Money market interest rates
(percentages per annum; period averages)

Euro area 1), 2) United
States
Japan
Overnight
1-month
3-month
6-month
12-month
3-month
3-month
deposits
deposits
deposits
deposits
deposits
deposits
deposits
(EONIA)
(EURIBOR)
(EURIBOR)
(EURIBOR)
(EURIBOR)
(LIBOR)
(LIBOR)
1
2
3
4
5
6
7
2007
3.87
4.08
4.28
4.35
4.45
5.30
0.79
2008
3.87
4.28
4.64
4.73
4.83
2.93
0.93

2009
0.71
0.89
1.22
1.43
1.61
0.69
0.47
2009 Q2
0.77
0.94
1.31
1.51
1.67
0.84
0.53
Q3
0.36
0.53
0.87
1.13
1.34
0.41
0.40
Q4
0.36
0.45
0.72
1.00
1.24
0.27
0.31

2010 Q1
0.34
0.42
0.66
0.96
1.22
0.26
0.25
Q2
0.35
0.43
0.69
0.98
1.25
0.44
0.24
2009 June
0.70
0.91
1.23
1.44
1.61
0.62
0.49
July
0.36
0.61
0.97
1.21
1.41
0.52
0.43
Aug.
0.35
0.51
0.86
1.12
1.33
0.42
0.40
Sep.
0.36
0.46
0.77
1.04
1.26
0.30
0.36
Oct.
0.36
0.43
0.74
1.02
1.24
0.28
0.33
Nov.
0.36
0.44
0.72
0.99
1.23
0.27
0.31
Dec.
0.35
0.48
0.71
1.00
1.24
0.25
0.28
2010 Jan.
0.34
0.44
0.68
0.98
1.23
0.25
0.26
Feb.
0.34
0.42
0.66
0.96
1.23
0.25
0.25
Mar.
0.35
0.41
0.64
0.95
1.22
0.27
0.25
Apr.
0.35
0.40
0.64
0.96
1.23
0.31
0.24
May
0.34
0.42
0.69
0.98
1.25
0.46
0.24

June
0.35
0.45
0.73
1.01
1.28
0.54
0.24
C23 Euro area money market rates 1), 2)
C24 3-month money market rates
(monthly averages; percentages per annum)
(monthly averages; percentages per annum)
1-month rate
euro area 1), 2)
3-month rate
Japan
12-month rate
United States
9.00
9.00
9.00
9.00
8.00
8.00
8.00
8.00
7.00
7.00
7.00
7.00
6.00
6.00
6.00
6.00
5.00
5.00
5.00
5.00
4.00
4.00
4.00
4.00
3.00
3.00
3.00
3.00
2.00
2.00
2.00
2.00
1.00
1.00
1.00
1.00
0.00
0.00
0.00
0.00
1994
1996
1998
2000
2002
2004
2006
2008
1994
1996
1998
2000
2002
2004
2006
2008

Source: ECB.
1)
Before January 1999 synthetic euro area rates were calculated on the basis of national rates weighted by GDP. For further information, see the General Notes.
2)
Data refer to the changing composition of the euro area. For further information, see the General Notes.
ECB
S Monthly Bulletin
44 July 2010

EURO AREA
STATISTICS
Financial
markets
4.7 Euro area yield curves 1)
(AAA-rated euro area central government bonds; end of period; rates in percentages per annum; spreads in percentage points)

Spot rates
Instantaneous forward rates
3 months
1 year
2 years
5 years
7 years
10 years
10 years
10 years
1 year
2 years
5 years
10 years
- 3 months
- 2 years
(spread)
(spread)
1
2
3
4
5
6
7
8
9
10
11
12
2007
3.85
4.00
4.01
4.11
4.23
4.38
0.52
0.36
4.06
4.02
4.40
4.78
2008
1.75
1.85
2.14
2.95
3.32
3.69
1.94
1.55
2.09
2.76
4.04
4.60
2009
0.38
0.81
1.38
2.64
3.20
3.76
3.38
2.38
1.41
2.44
4.27
5.20
2009 Q1
0.78
0.88
1.46
2.70
3.23
3.77
3.00
2.31
1.41
2.58
4.24
5.19
Q2
0.62
0.90
1.50
2.85
3.42
3.99
3.37
2.49
1.47
2.67
4.54
5.42
Q3
0.41
0.70
1.33
2.59
3.12
3.64
3.23
2.31
1.34
2.47
4.14
4.96
Q4
0.38
0.81
1.38
2.64
3.20
3.76
3.38
2.38
1.41
2.44
4.27
5.20
2010 Q1
0.33
0.60
1.05
2.28
2.86
3.46
3.13
2.41
1.02
1.98
3.96
5.02
2009 June
0.62
0.90
1.50
2.85
3.42
3.99
3.37
2.49
1.47
2.67
4.54
5.42
July
0.49
0.74
1.43
2.68
3.21
3.74
3.26
2.31
1.49
2.62
4.21
5.13
Aug.
0.44
0.74
1.46
2.69
3.19
3.68
3.24
2.22
1.55
2.66
4.16
4.95
Sep.
0.41
0.70
1.33
2.59
3.12
3.64
3.23
2.31
1.34
2.47
4.14
4.96
Oct.
0.50
0.81
1.43
2.61
3.13
3.68
3.18
2.25
1.49
2.50
4.12
5.11
Nov.
0.44
0.80
1.34
2.49
3.01
3.57
3.13
2.23
1.38
2.32
4.00
5.04
Dec.
0.38
0.81
1.38
2.64
3.20
3.76
3.38
2.38
1.41
2.44
4.27
5.20
2010 Jan.
0.28
0.71
1.25
2.48
3.06
3.66
3.38
2.42
1.28
2.25
4.15
5.23
Feb.
0.30
0.54
1.02
2.29
2.88
3.49
3.19
2.46
0.98
2.01
3.99
5.08
Mar.
0.33
0.60
1.05
2.28
2.86
3.46
3.13
2.41
1.02
1.98
3.96
5.02
Apr.
0.32
0.60
1.01
2.18
2.78
3.40
3.07
2.39
1.00
1.85
3.89
4.94
May
0.21
0.28
0.57
1.75
2.39
3.00
2.78
2.43
0.47
1.28
3.58
4.46

June
0.34
0.42
0.69
1.79
2.41
3.03
2.68
2.33
0.62
1.35
3.54
4.52
C25 Euro area spot yield curves
C26 Euro area spot rates and spreads
(percentages per annum; end of period)
(daily data; rates in percentages per annum; spreads in percentage points)
1-year rate (left-hand scale)
June 2010
10-year rate (left-hand scale)
May 2010
spread between 10-year and 3-month rates (right-hand scale)
April 2010
spread between 10-year and 2-year rates (right-hand scale)
5.0
5.0
5.0
4.5
4.5
4.5
4.0
4.0
4.0
3.5
3.5
3.5
3.0
3.0
3.0
2.5
2.5
2.5
2.0
2.0
2.0
1.5
1.5
1.5
1.0
1.0
1.0
0.5
0.5
0.5
0.0
0.0
0.0
-0.5
-0.5
-0.5
0
5yrs
10yrs
15yrs
20yrs
25yrs
30yrs
2008
2009
2010

Sources: ECB calculations based on underlying data provided by EuroMTS and ratings provided by Fitch Ratings.
1)
Data refer to the changing composition of the euro area. For further information, see the General Notes.
ECB
Monthly Bulletin
July 2010 S 45

4.8 Stock market indices
(index levels in points; period averages)

Dow Jones EURO STOXX indices 1) United
Japan

States
Benchmark
Main industry indices
Broad
50
Basic
Consumer
Consumer
Oil and Financials Industrials Technology
Utilities
Telecoms Health care
Standard
Nikkei
index
materials
services
goods
gas
& Poor’s
225
500
1
2
3
4
5
6
7
8
9
10
11
12
13
14
2007
416.4
4,315.8
543.8
235.4
366.5
449.6
408.3
488.4
383.4
561.4
492.7
519.2
1,476.5
16,984.4
2008
313.7
3,319.5
480.4
169.3
290.7
380.9
265.0
350.9
282.5
502.0
431.5
411.5
1,220.7
12,151.6

2009
234.2
2,521.0
353.2
140.5
244.5
293.5
172.1
269.7
200.7
353.7
380.4
363.5
946.2
9,321.6
2009 Q2
220.5
2,376.6
326.9
136.6
229.5
287.3
158.6
251.0
201.1
337.7
351.5
343.8
892.0
9,274.8
Q3
247.2
2,660.6
369.0
142.0
257.1
296.8
192.7
286.0
211.3
361.1
386.0
365.1
994.2
10,117.3
Q4
268.1
2,872.7
422.1
151.5
282.8
316.9
209.7
317.7
214.1
375.3
416.5
399.3
1,088.7
9,969.2
2010 Q1
268.0
2,849.0
445.0
159.3
294.9
320.0
195.5
326.7
229.9
372.4
398.8
426.3
1,123.6
10,511.2

Q2
261.1
2,735.7
446.3
163.7
312.9
305.0
178.8
334.3
229.1
349.6
372.2
412.0
1,134.6
10,345.9
2009 June
226.7
2,449.0
341.0
135.3
235.9
298.3
166.8
255.5
204.3
343.8
349.6
357.0
926.1
9,810.3
July
228.0
2,462.1
337.9
134.8
243.7
288.6
170.6
256.8
198.8
334.7
364.8
352.9
934.1
9,678.3
Aug.
250.7
2,702.7
377.6
142.1
261.8
293.2
198.6
290.3
208.5
365.7
387.2
364.1
1,009.7
10,430.4
Sep.
264.0
2,827.9
393.3
149.5
266.5
308.7
210.2
312.5
227.2
384.4
407.0
378.8
1,044.6
10,302.9
Oct.
268.7
2,865.5
403.7
150.1
277.5
314.2
216.0
318.4
221.3
375.4
415.0
393.6
1,067.7
10,066.2
Nov.
265.4
2,843.8
415.4
149.5
280.0
315.3
208.7
313.6
209.9
369.8
414.5
391.5
1,088.1
9,641.0
Dec.
270.1
2,907.6
447.0
155.0
290.9
321.1
204.3
321.0
211.0
380.5
419.8
412.4
1,110.4
10,169.0
2010 Jan.
273.5
2,922.7
449.4
158.9
295.7
329.8
204.6
331.6
223.1
384.1
407.4
425.5
1,123.6
10,661.6
Feb.
257.0
2,727.5
427.9
154.3
285.3
309.8
183.9
312.3
222.7
360.9
386.8
415.0
1,089.2
10,175.1
Mar.
272.6
2,890.5
456.0
164.0
302.4
320.3
197.7
335.0
242.2
372.2
401.9
436.8
1,152.0
10,671.5
Apr.
278.6
2,937.3
470.9
171.7
313.8
328.6
199.7
349.0
248.8
378.9
396.7
430.0
1,197.3
11,139.8
May
252.7
2,642.1
431.4
159.6
305.2
295.4
170.8
324.8
221.9
341.7
360.0
401.0
1,125.1
10,104.0

June
253.2
2,641.7
438.1
160.4
319.5
292.7
167.5
330.0
218.3
330.5
361.6
406.1
1,083.4
9,786.1
C27 Dow Jones EURO STOXX broad index, Standard & Poor's 500 and Nikkei 225
(January 1994 = 100; monthly averages)
1)
Dow Jones EURO STOXX broad index
Standard & Poor’s 500
Nikkei 225
350
350
300
300
250
250
200
200
150
150
100
100
50
50
0
0
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009

Source: ECB.
1)
Data refer to the changing composition of the euro area. For further information, see the General Notes.
ECB
S Monthly Bulletin
46 July 2010

PRICES, OUTPUT, DEMAND AND
5
LABOUR MARKETS
5.1 HICP, other prices and costs
(annual percentage changes, unless otherwise indicated)
1. Harmonised Index of Consumer Prices 1)

Total
Total (s.a.; percentage change vis-à-vis previous period)
Memo item:

Administered prices 2)
Index:
Total
Goods Services
Total
Processed Unprocessed
Non-energy
Energy
Services
2005 = 100
food
food
industrial
(n.s.a.)
Total HICP Administered
Total excl.
goods
excluding
prices
unprocessed
administered
food and energy
prices
% of total 3)
100.0
100.0
83.1
58.0
42.0
100.0
11.9
7.3
29.3
9.6
42.0
88.9
11.1
1
2
3
4
5
6
7
8
9
10
11
12
13
2006
102.2
2.2
1.5
2.3
2.0
-
-
-
-
-
-
2.1
2.5
2007
104.4
2.1
2.0
1.9
2.5
-
-
-
-
-
-
2.1
2.3
2008
107.8
3.3
2.4
3.8
2.6
-
-
-
-
-
-
3.4
2.7

2009
108.1
0.3
1.3
-0.9
2.0
-
-
-
-
-
-
0.1
1.7
2009 Q1
107.4
1.0
1.6
0.1
2.2
-0.3
0.0
0.1
0.1
-4.9
0.4
0.7
2.9
Q2
108.3
0.2
1.5
-1.2
2.2
0.3
0.1
-0.8
0.1
0.7
0.5
0.0
1.8
Q3
108.0
-0.4
1.2
-1.9
1.8
0.2
0.3
-0.8
0.0
0.8
0.4
-0.6
1.2
Q4
108.6
0.4
1.0
-0.4
1.7
0.2
0.1
0.1
0.0
0.3
0.4
0.4
0.8

2010 Q1
108.6
1.1
0.9
0.9
1.5
0.4
0.0
0.7
0.0
3.0
0.3
1.2
0.4
2010 Jan.
108.1
1.0
0.9
0.7
1.4
0.2
-0.1
0.3
-0.1
2.1
0.0
1.1
0.4
Feb.
108.4
0.9
0.8
0.6
1.3
0.1
0.0
0.3
0.0
-0.1
0.1
1.0
0.4
Mar.
109.4
1.4
0.9
1.3
1.6
0.4
0.0
0.6
0.0
2.6
0.3
1.6
0.4
Apr.
109.9
1.5
0.8
1.8
1.2
0.2
0.1
0.5
0.1
2.0
-0.1
1.6
1.2

May
110.0
1.6
0.9
1.9
1.3
0.1
0.2
-0.6
0.1
0.6
0.1
1.6
1.4
June 4)
.
1.4
. . . .
.
.
. . .
.
.

Goods
Services

Food (incl. alcoholic beverages and tobacco)
Industrial goods
Housing
Transport Communication
Recreation Miscellaneous
and
Total
Processed
Unprocessed
Total
Non-energy
Energy
Rents
personal
food
food
industrial
goods
% of total 3)
19.2
11.9
7.3
38.9
29.3
9.6
10.2
6.0
6.6
3.3
14.9
7.1
14
15
16
17
18
19
20
21
22
23
24
25
2006
2.4
2.1
2.8
2.3
0.6
7.7
2.5
2.1
2.5
-3.3
2.3
2.3
2007
2.8
2.8
3.0
1.4
1.0
2.6
2.7
2.0
2.6
-1.9
2.9
3.2
2008
5.1
6.1
3.5
3.1
0.8
10.3
2.3
1.9
3.9
-2.2
3.2
2.5

2009
0.7
1.1
0.2
-1.7
0.6
-8.1
2.0
1.8
2.9
-1.0
2.1
2.1
2009 Q1
2.4
2.1
2.8
-1.1
0.7
-6.1
2.0
1.7
3.6
-1.7
2.7
2.1
Q2
1.0
1.1
0.8
-2.3
0.7
-10.7
2.1
1.8
3.1
-1.2
2.7
2.0
Q3
-0.1
0.6
-1.2
-2.8
0.5
-11.9
2.0
1.8
2.5
-0.6
1.8
2.1

Q4
-0.2
0.5
-1.5
-0.5
0.3
-3.2
1.9
1.7
2.5
-0.6
1.4
2.2
2010 Q1
0.0
0.6
-0.8
1.3
0.1
4.8
1.9
1.6
2.5
-0.5
1.1
1.6
2009 Dec.
-0.2
0.7
-1.6
0.8
0.4
1.8
1.9
1.7
2.5
-0.8
1.2
2.2
2010 Jan.
-0.1
0.6
-1.3
1.1
0.1
4.0
1.9
1.7
2.6
-0.9
1.0
1.6
Feb.
-0.1
0.6
-1.2
0.9
0.1
3.3
1.9
1.6
2.2
-0.4
0.9
1.6
Mar.
0.3
0.5
-0.1
1.8
0.1
7.2
1.9
1.6
2.7
-0.3
1.4
1.5
Apr.
0.7
0.6
0.7
2.3
0.2
9.1
1.9
1.5
2.4
-0.6
0.4
1.4

May
0.7
0.9
0.4
2.5
0.3
9.2
1.8
1.5
2.2
-1.1
0.9
1.5
Sources: Eurostat and ECB calculations.
1)
Data refer to the changing composition of the euro area. For further information, see the General Notes.
2)
These experimental statistics can only provide an approximate measure of price administration, since changes in administered prices cannot be fully isolated from other

influences. Please refer to Eurostat’s website (http://epp.eurostat.ec.europa.eu/portal/page/portal/hicp/introduction) for a note explaining the methodology used in the

compilation of this indicator.
3)
Weighting used in 2010.
4)
Estimate based on provisional national releases, which usually cover around 95% of the euro area, as well as on early information on energy prices.
ECB
Monthly Bulletin
July 2010 S 47

5.1 HICP, other prices and costs
(annual percentage changes, unless otherwise indicated)
2. Industry, construction and residential property prices

Industrial producer prices excluding construction
Construct-
Residential

ion 1)
property
Total
Total
Industry excluding construction and energy
Energy
prices 2)
(index:

2005 = 100)
Manu-
Total
Intermediate
Capital
Consumer goods
facturing
goods
goods
Total
Durable
Non-durable
% of total 3)
100.0
100.0
83.0
75.8
30.1
21.9
23.7
2.7
21.0
24.2
1
2
3
4
5
6
7
8
9
10
11
12
2006
105.1
5.1
3.5
2.7
4.6
1.6
1.5
1.4
1.4
13.5
4.6
6.6
2007
107.9
2.7
3.0
3.2
4.6
2.2
2.2
2.5
2.2
1.2
4.1
4.5
2008
114.4
6.1
4.8
3.4
3.9
2.1
3.9
2.8
4.1
14.1
3.8
1.5

2009
108.6
-5.1
-5.4
-2.8
-5.3
0.4
-2.0
1.2
-2.4
-11.5
0.1
-3.1
2009 Q1
109.8
-2.0
-4.3
-1.1
-2.7
1.8
-1.0
1.8
-1.4
-4.4
2.6
-
Q2
108.3
-5.7
-6.8
-3.0
-5.8
0.7
-2.0
1.5
-2.5
-13.4
-0.2
-3.1 4)
Q3
108.0
-7.8
-7.4
-4.1
-7.5
-0.1
-2.6
1.0
-3.1
-18.0
-1.7
-
Q4
108.4
-4.6
-3.0
-3.1
-5.0
-0.6
-2.4
0.5
-2.8
-9.5
-0.2
-3.1 4)

2010 Q1
109.6
-0.2
1.7
-0.5
-0.4
-0.5
-0.5
0.3
-0.7
0.2
. -
2009 Dec.
108.5
-2.9
-0.8
-2.3
-3.5
-0.5
-2.0
0.5
-2.3
-5.1
- -
2010 Jan.
109.3
-1.0
0.9
-1.0
-1.6
-0.6
-0.7
0.5
-0.8
-1.6
- -
Feb.
109.4
-0.4
1.5
-0.5
-0.4
-0.5
-0.5
0.3
-0.6
-0.7
- -
Mar.
110.1
0.9
2.7
0.1
0.8
-0.3
-0.4
0.3
-0.5
2.9
- -
Apr.
111.2
2.8
3.7
1.1
2.8
0.0
-0.3
0.4
-0.4
7.7
- -

May
111.5
3.1
4.0
1.7
3.9
0.2
0.0
0.7
-0.1
7.0
- -
3. Commodity prices and gross domestic product deflators 1)

Oil prices 5)
Non-energy commodity prices
GDP deflators
(EUR per

barrel)
Import-weighted 6)
Use-weighted 7)
Total
Total
Domestic demand
Exports 8)
Imports 8)
(s.a.; index:
Total
Food Non-food
Total
Food Non-food 2000 = 100)
Total
Private Government
Gross
consump-
consump-
fixed
tion
tion
capital
formation
% of total
100.0
35.0
65.0
100.0
45.0
55.0
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
2006
52.9
27.7
5.8
37.9
24.5
5.9
38.2
113.8
1.9
2.4
2.2
2.0
2.9
2.6
3.8
2007
52.8
7.8
14.3
5.5
5.3
9.4
2.9
116.5
2.4
2.3
2.3
1.6
2.7
1.6
1.4
2008
65.9
2.0
18.5
-4.4
-1.7
9.7
-8.6
119.0
2.2
2.7
2.8
2.6
2.4
2.6
3.7

2009
44.6
-18.5
-8.9
-23.1
-18.0
-11.5
-22.8
120.2
1.0
0.0
-0.2
1.8
-0.9
-3.1
-5.6
2009 Q1
35.1
-29.3
-15.0
-36.1
-28.7
-17.7
-36.9
120.1
1.8
0.9
0.3
2.4
0.6
-1.9
-4.2
Q2
43.8
-24.5
-11.2
-30.9
-22.5
-10.0
-31.4
120.0
1.0
-0.2
-0.4
1.3
-0.9
-3.4
-6.6
Q3
48.1
-18.7
-12.7
-21.5
-18.9
-15.3
-21.4
120.2
0.8
-0.6
-0.8
2.2
-1.8
-4.3
-8.0
Q4
51.2
3.2
5.8
1.9
2.5
-0.9
5.1
120.3
0.2
0.0
0.2
1.4
-1.4
-2.7
-3.5

2010 Q1
56.0
29.0
7.5
42.7
27.4
7.5
46.6
120.8
0.5
0.2
1.3
1.6
-0.4
2.3
1.3
2010 Jan.
54.0
27.3
8.5
39.2
25.7
7.7
43.1
-
-
- - -
- - -
Feb.
54.5
25.4
5.0
38.4
25.0
7.1
42.3
-
-
- - -
- - -
Mar.
59.1
34.5
8.9
50.5
31.5
7.7
54.5
-
-
- - -
- - -
Apr.
64.0
51.9
8.1
78.7
43.8
8.8
76.2
-
-
- - -
- - -

May
61.6
52.1
11.5
77.8
43.6
12.0
73.8
-
-
- - -
- - -
June
62.2
50.5
16.4
71.4
43.4
19.7
64.8
-
-
- - -
- - -
Sources: Eurostat, ECB calculations based on Eurostat data (column 7 in Table 2 in Section 5.1 and columns 8-15 in Table 3 in Section 5.1), ECB calculations based on
Thomson Financial Datastream data (column 1 in Table 3 in Section 5.1) and ECB calculations (column 12 in Table 2 in Section 5.1 and columns 2-7 in Table 3 in Section 5.1).
1)
Input prices for residential buildings.
2)
Experimental data based on non-harmonised national sources (see http://www.ecb.europa.eu/stats/intro/html/experiment.en.html for further details).
3)
In 2005.
4)
The quarterly data for the second and fourth quarters refer to biannual averages for the first and second halves of the year respectively. Since some national data are only
available annually, the biannual estimate is partially derived from annual results; consequently, the accuracy of biannual data is lower than the accuracy of annual data.
5)
Brent Blend (for one-month forward delivery).
6)
Refers to prices expressed in euro. Weighted according to the structure of euro area imports in the period 2004-06.
7)
Refers to prices expressed in euro. Weighted according to euro area domestic demand (domestic production plus imports minus exports) in the period 2004-06. Experimental data
(see http://www.ecb.europa.eu/stats/intro/html/experiment.en.html for details).
8)
Deflators for exports and imports refer to goods and services and include cross-border trade within the euro area.
ECB
S Monthly Bulletin
48 July 2010

EURO AREA
STATISTICS
Prices, output,
demand and
labour markets
5.1 HICP, other prices and costs
(annual percentage changes, unless otherwise indicated)
4. Unit labour costs, compensation per labour input and labour productivity
(seasonally adjusted)

Total
Total
By economic activity
(index:
2000 = 100)
Agriculture, hunting,
Mining,
Construction
Trade, repairs, hotels and
Financial, real estate,
Public administration,
forestry and fishing
manufacturing
restaurants, transport and
renting and business
education, health
and energy
communication
services
and other services
1
2
3
4
5
6
7
8
Unit labour costs 1)
2008
115.4
3.3
0.3
3.7
3.3
3.3
3.2
2.9

2009
119.9
3.9
-1.2
10.1
1.4
5.0
0.8
2.4
2009 Q2
120.2
4.7
-1.0
14.1
1.2
6.0
1.5
1.6
Q3
119.7
3.5
-2.2
8.7
0.5
3.8
0.4
3.3
Q4
119.7
1.3
-1.4
1.4
1.5
2.4
0.5
1.7

2010 Q1
119.6
-0.5
. .
.
.
.
.
Compensation per employee
2008
121.4
3.1
3.9
3.0
4.7
2.8
2.4
3.5

2009
123.3
1.5
2.2
0.3
2.6
1.5
1.4
2.3
2009 Q2
122.9
1.5
2.2
0.1
3.0
1.9
2.0
1.7
Q3
123.6
1.4
2.3
0.4
2.5
0.4
1.4
3.0

Q4
124.1
1.3
2.2
0.4
2.1
1.3
1.5
1.8
2010 Q1
124.2
1.4
. .
.
.
.
.
Labour productivity per person employed 2)
2008
105.3
-0.2
3.5
-0.7
1.4
-0.4
-0.8
0.6

2009
102.8
-2.3
3.5
-8.9
1.1
-3.3
0.6
0.0
2009 Q2
102.3
-3.1
3.2
-12.3
1.8
-3.9
0.5
0.0
Q3
103.3
-1.9
4.6
-7.6
2.0
-3.3
1.0
-0.2

Q4
103.6
0.0
3.6
-1.0
0.7
-1.1
1.0
0.1
2010 Q1
103.8
1.9
1.8
9.4
-1.5
1.3
0.9
0.1
Compensation per hour worked
2008
124.1
3.2
2.0
3.6
4.4
3.0
2.2
3.4

2009
127.6
2.8
4.0
3.7
4.4
2.2
2.4
2.5
2009 Q2
127.5
3.2
3.3
5.0
4.9
2.7
3.3
2.1
Q3
127.8
2.7
4.1
3.7
4.2
1.2
2.5
3.0

Q4
127.8
1.8
3.8
0.9
3.7
1.5
2.1
1.8
2010 Q1
127.9
0.6
. .
.
.
.
.
Hourly labour productivity 2)
2008
108.2
0.0
3.1
-0.1
1.3
-0.1
-1.0
0.4

2009
107.0
-1.1
3.5
-6.0
2.6
-2.7
1.8
0.0
2009 Q2
106.6
-1.6
2.4
-8.2
3.4
-3.0
2.0
0.3
Q3
107.3
-0.8
4.8
-4.7
3.4
-2.7
2.3
-0.3
Q4
107.3
0.3
3.6
-0.7
1.6
-1.1
1.7
0.1

2010 Q1
107.6
1.2
3.1
7.1
-2.7
0.5
0.6
-0.5
5. Labour cost indices 3)

Total
Total
By component
For selected economic activities
Memo item:
(s.a.; index:
Indicator
2008 = 100)
Wages and
Employers’ social
Mining,
Construction
Services
of
salaries
contributions
manufacturing
negotiated
and energy
wages 4)
% of total 5)
100.0
100.0
75.2
24.8
32.4
9.0
58.6
1
2
3
4
5
6
7
8
2008
100.0
3.5
3.6
3.4
3.8
4.7
3.1
3.3

2009
102.6
2.7
2.6
3.0
3.1
3.7
2.3
2.7
2009 Q2
102.5
3.3
3.2
3.4
4.3
4.5
2.6
2.8
Q3
102.9
2.6
2.7
2.6
3.5
2.5
2.2
2.4

Q4
103.3
1.7
1.6
2.0
0.6
3.3
2.1
2.2
2010 Q1
104.0
2.1
2.0
2.1
1.8
2.1
2.2
1.7
Sources: Eurostat, ECB calculations based on Eurostat data (Table 4 in Section 5.1) and ECB calculations (column 8 in Table 5 in Section 5.1).
1)
Compensation (at current prices) per employee divided by value added (volumes) per person employed.
2)
Value added (volumes) per labour input (persons employed and hours worked).
3)
Hourly labour cost indices for the whole economy, excluding agriculture, public administration, education, health and services not classified elsewhere. Owing to
differences in coverage, the estimates for the components may not be consistent with the total.
4)
Experimental data (see http://www.ecb.europa.eu/stats/intro/html/experiment.en.html for further details).
5)
In 2008.
ECB
Monthly Bulletin
July 2010 S 49

5.2 Output and demand
1. GDP and expenditure components

GDP

Total
Domestic demand
External balance 1)
Total
Private
Government
Gross fixed
Changes in
Total
Exports 1)
Imports 1)
consumption
consumption
capital
inventories 2)
formation
1
2
3
4
5
6
7
8
9
Current prices (EUR billions; seasonally adjusted)
2006
8,562.4
8,466.0
4,872.9
1,733.6
1,834.4
25.2
96.3
3,453.2
3,356.9
2007
9,013.3
8,874.2
5,067.5
1,802.8
1,970.5
33.4
139.2
3,734.7
3,595.5
2008
9,258.2
9,160.0
5,228.6
1,891.8
2,000.5
39.2
98.2
3,862.7
3,764.5
2009
8,967.8
8,849.3
5,158.8
1,979.1
1,769.0
-57.7
118.5
3,249.6
3,131.1
2009 Q1
2,237.1
2,221.6
1,285.4
488.7
452.9
-5.5
15.5
807.7
792.2
Q2
2,233.8
2,204.5
1,287.5
492.7
444.2
-19.9
29.4
791.4
762.0
Q3
2,246.3
2,212.0
1,287.6
499.8
438.2
-13.6
34.3
815.1
780.8
Q4
2,250.5
2,211.2
1,298.2
498.0
433.7
-18.7
39.3
835.5
796.2

2010 Q1
2,263.4
2,232.3
1,302.2
503.3
429.4
-2.6
31.1
873.2
842.1

percentage of GDP

2009
100.0
98.7
57.5
22.1
19.7
-0.6
1.3
- -

Chain-linked volumes (prices for the previous year; seasonally adjusted 3) )

quarter-on-quarter percentage changes
2009 Q1
-2.5
-2.4
-0.6
0.8
-5.3
- -
-8.4
-8.0
Q2
-0.1
-0.7
0.1
0.7
-1.5
- -
-1.1
-2.8
Q3
0.4
0.3
-0.2
0.7
-1.1
- -
2.9
2.8
Q4
0.1
-0.1
0.2
-0.2
-1.2
- -
1.8
1.2

2010 Q1
0.2
0.8
-0.1
0.2
-1.2
- -
2.1
3.8

annual percentage changes
2006
3.0
2.9
2.0
2.1
5.4
- -
8.6
8.5
2007
2.8
2.4
1.6
2.3
4.6
- -
6.3
5.5

2008
0.6
0.6
0.3
2.2
-0.6
- -
0.9
1.0
2009
-4.1
-3.5
-1.2
2.7
-10.9
- -
-13.3
-12.0
2009 Q1
-5.2
-3.7
-1.7
3.0
-11.5
- -
-16.4
-13.3
Q2
-4.9
-3.8
-1.2
2.9
-11.5
- -
-17.0
-14.7
Q3
-4.1
-3.5
-1.3
3.0
-11.4
- -
-13.6
-12.4
Q4
-2.1
-2.8
-0.5
2.0
-8.7
- -
-5.2
-7.0

2010 Q1
0.6
0.3
0.0
1.4
-4.8
- -
5.7
4.9

contributions to quarter-on-quarter percentage changes in GDP; percentage points
2009 Q1
-2.5
-2.4
-0.3
0.2
-1.1
-1.1
-0.2
- -
Q2
-0.1
-0.7
0.1
0.1
-0.3
-0.6
0.6
- -
Q3
0.4
0.3
-0.1
0.1
-0.2
0.5
0.1
- -

Q4
0.1
-0.1
0.1
0.0
-0.2
0.0
0.2
- -
2010 Q1
0.2
0.8
-0.1
0.0
-0.2
1.0
-0.6
- -

contributions to annual percentage changes in GDP; percentage points
2006
3.0
2.8
1.2
0.4
1.1
0.1
0.1
- -
2007
2.8
2.4
0.9
0.5
1.0
0.0
0.4
- -

2008
0.6
0.6
0.2
0.4
-0.1
0.1
0.0
- -
2009
-4.1
-3.4
-0.7
0.5
-2.3
-0.9
-0.7
- -
2009 Q1
-5.2
-3.7
-1.0
0.6
-2.5
-0.8
-1.5
- -
Q2
-4.9
-3.7
-0.7
0.6
-2.5
-1.1
-1.2
- -
Q3
-4.1
-3.4
-0.7
0.6
-2.5
-0.8
-0.7
- -
Q4
-2.1
-2.8
-0.3
0.4
-1.8
-1.1
0.7
- -

2010 Q1
0.6
0.3
0.0
0.3
-1.0
1.0
0.3
- -
Sources: Eurostat and ECB calculations.
1)
Exports and imports cover goods and services and include cross-border intra-euro area trade. They are not fully consistent with: Section 3.1; Table 1 of Section 7.1; Table 3 of

Section 7.2; or Tables 1 or 3 of Section 7.5.
2)
Including acquisitions less disposals of valuables.
3)
Annual data are not working day-adjusted.
ECB
S Monthly Bulletin
50 July 2010

EURO AREA
STATISTICS
Prices, output,
demand and
labour markets
5.2 Output and demand
2. Value added by economic activity

Gross value added (basic prices)
Taxes less
subsidies on
Total
Agriculture,
Mining,
Construction
Trade, repairs,
Financial, real
Public
products
hunting,
manufacturing
hotels and
estate, renting
administration,
forestry
and energy
restaurants,
and business
education,
and fishing
transport and
activities
health and
activities
communication
other services
1
2
3
4
5
6
7
8
Current prices (EUR billions; seasonally adjusted)
2006
7,648.5
140.8
1,565.3
477.8
1,596.8
2,137.2
1,730.4
913.9
2007
8,054.7
151.4
1,644.5
511.1
1,671.0
2,273.8
1,802.9
958.7
2008
8,312.4
147.0
1,656.5
534.2
1,731.3
2,361.7
1,881.7
945.8
2009
8,074.5
130.7
1,431.8
516.0
1,670.5
2,370.5
1,955.0
893.2
2009 Q1
2,013.9
34.1
356.2
131.5
416.9
591.4
483.8
223.3
Q2
2,012.1
32.8
353.1
129.6
417.1
592.3
487.1
221.8
Q3
2,022.7
31.7
360.2
128.4
418.5
592.7
491.1
223.6
Q4
2,025.9
32.1
362.3
126.5
417.9
594.1
493.0
224.6

2010 Q1
2,041.6
33.0
369.1
124.0
419.3
599.5
496.6
221.9

percentage of value added

2009
100.0
1.6
17.7
6.4
20.7
29.4
24.2
-

Chain-linked volumes (prices for the previous year; seasonally adjusted 1) )

quarter-on-quarter percentage changes
2009 Q1
-2.6
0.9
-8.7
-1.1
-3.2
-1.0
0.2
-1.8
Q2
-0.1
-0.1
-1.0
-1.2
0.0
0.0
0.6
0.4
Q3
0.3
0.8
2.1
-1.4
0.0
-0.1
0.2
0.9
Q4
0.1
-0.5
0.6
-1.4
0.0
0.1
0.2
0.7

2010 Q1
0.5
0.4
1.9
-2.3
0.1
0.5
0.4
-2.2

annual percentage changes
2006
2.9
0.0
3.6
2.8
2.7
4.2
1.4
3.3
2007
3.0
0.4
2.5
2.4
3.4
4.1
2.1
0.9

2008
0.8
1.6
-0.7
-0.9
0.8
1.4
1.6
-1.2
2009
-4.3
1.2
-13.6
-5.8
-5.0
-1.6
1.2
-2.5
2009 Q1
-5.3
1.2
-16.7
-6.5
-6.0
-1.6
1.2
-4.5
Q2
-5.1
0.7
-16.7
-5.6
-5.6
-1.9
1.4
-3.2
Q3
-4.3
1.6
-13.2
-5.5
-5.1
-1.8
1.1
-2.3
Q4
-2.4
1.1
-7.1
-5.0
-3.3
-1.1
1.2
0.1

2010 Q1
0.7
0.6
3.6
-6.2
0.0
0.5
1.4
-0.3

contributions to quarter-on-quarter percentage changes in value added; percentage points
2009 Q1
-2.6
0.0
-1.7
-0.1
-0.7
-0.3
0.0
-
Q2
-0.1
0.0
-0.2
-0.1
0.0
0.0
0.1
-
Q3
0.3
0.0
0.4
-0.1
0.0
0.0
0.0
-

Q4
0.1
0.0
0.1
-0.1
0.0
0.0
0.0
-
2010 Q1
0.5
0.0
0.3
-0.1
0.0
0.2
0.1
-

contributions to annual percentage changes in value added; percentage points
2006
2.9
0.0
0.7
0.2
0.6
1.1
0.3
-
2007
3.0
0.0
0.5
0.1
0.7
1.2
0.5
-

2008
0.8
0.0
-0.1
-0.1
0.2
0.4
0.4
-
2009
-4.3
0.0
-2.7
-0.4
-1.1
-0.5
0.3
-
2009 Q1
-5.3
0.0
-3.4
-0.4
-1.3
-0.5
0.3
-
Q2
-5.1
0.0
-3.4
-0.4
-1.2
-0.5
0.3
-
Q3
-4.3
0.0
-2.6
-0.4
-1.1
-0.5
0.3
-
Q4
-2.4
0.0
-1.4
-0.3
-0.7
-0.3
0.3
-

2010 Q1
0.7
0.0
0.6
-0.4
0.0
0.1
0.3
-
Sources: Eurostat and ECB calculations.
1)
Annual data are not working day-adjusted.
ECB
Monthly Bulletin
July 2010 S 51

5.2 Output and demand
(annual percentage changes, unless otherwise indicated)
3. Industrial production

Total
Industry excluding construction
Construction

Total
Total
Industry excluding construction and energy
Energy
(s.a.; index:

2005 = 100)
Manu-
Total
Intermediate
Capital
Consumer goods
facturing
goods
goods
Total
Durable
Non-durable
% of total 1)
100.0
78.0
78.0
69.4
68.8
28.2
22.1
18.5
2.6
15.9
9.1
22.0
1
2
3
4
5
6
7
8
9
10
11
12
2007
3.2
108.1
3.7
4.1
4.3
3.7
6.6
2.4
1.4
2.5
-0.9
1.2
2008
-2.3
106.1
-1.7
-1.9
-1.9
-3.4
-0.1
-2.0
-5.7
-1.4
0.3
-4.4

2009
-13.9
90.3
-15.1
-16.1
-16.6
-19.2
-21.4
-5.0
-17.5
-3.0
-5.7
-8.2
2009 Q2
-16.9
88.8
-18.9
-19.7
-20.2
-24.3
-24.8
-5.9
-21.2
-3.3
-8.9
-7.5
Q3
-13.8
89.6
-14.6
-15.4
-15.9
-18.3
-21.5
-4.0
-18.3
-1.9
-6.1
-9.1
Q4
-7.5
91.6
-7.7
-8.2
-8.6
-6.8
-14.4
-2.6
-10.2
-1.4
-3.8
-6.0

2010 Q1
1.7
95.3
4.6
4.9
4.9
7.8
2.6
3.3
0.0
3.7
2.9
-10.0
2009 Nov.
-7.3
91.7
-7.0
-7.2
-7.5
-5.8
-13.5
-1.9
-7.9
-1.0
-5.1
-7.4
Dec.
-4.0
92.5
-4.0
-4.5
-4.9
-0.2
-11.6
-0.8
-7.3
0.0
-1.7
-3.7
2010 Jan.
-0.6
94.3
1.7
1.9
2.1
4.2
-0.4
1.4
-2.7
1.9
0.9
-10.6
Feb.
0.5
95.0
4.1
4.4
4.5
6.9
3.0
2.6
0.9
2.9
2.2
-14.2
Mar.
4.9
96.5
7.8
8.1
7.7
11.8
4.9
5.7
1.7
6.3
6.0
-5.8

Apr.
6.4
97.3
9.5
9.5
9.5
15.8
8.8
2.6
1.1
2.8
6.7
-5.8

month-on-month percentage changes (s.a.)
2009 Nov.
0.8
- 1.4
1.6
1.6
0.8
1.7
1.5
2.1
1.0
-2.4
-1.1
Dec.
0.6
- 0.8
0.4
-0.2
-0.3
0.1
0.4
-1.5
0.7
3.1
0.3
2010 Jan.
1.3
- 2.0
1.9
2.2
0.7
-0.8
1.0
2.2
0.9
2.9
-2.0
Feb.
-1.0
- 0.8
0.8
0.2
1.2
0.7
0.0
0.4
0.1
-0.8
-6.4
Mar.
3.1
- 1.6
1.9
1.6
1.1
1.8
1.1
0.2
1.6
0.2
6.8

Apr.
0.5
- 0.8
0.6
0.6
2.1
0.9
-1.0
-0.3
-1.3
-1.0
-0.3
4. Industrial new orders and turnover, retail sales and new passenger car registrations

Industrial new orders Industrial turnover
Retail sales (excluding automotive fuel)
New passenger car

registrations
Manufacturing 2)
Manufacturing
Current prices
Constant prices

(current prices)
(current prices)

Total
Total
Total
Total
Total
Total
Total
Food,
Non-food
Total (s.a.;
Total
(s.a.; index:
(s.a.; index:
(s.a.; index:
beverages,
thousands) 3)
2005 = 100)
2005 = 100)
2005 = 100)
tobacco
Textiles,
Household
clothing,
equipment
footwear
% of total 1)
100.0
100.0
100.0
100.0
100.0
100.0
100.0
42.9
57.1
9.9
13.9
1
2
3
4
5
6
7
8
9
10
11
12
13
2007
119.9
8.6
115.1
6.5
2.6
104.3
1.8
0.0
3.1
4.0
3.1
968
-0.6
2008
113.0
-5.3
116.9
1.9
1.7
103.4
-0.8
-1.9
-0.1
-1.8
-1.9
896
-7.0

2009
87.7
-22.8
95.5
-18.5
-2.7
101.6
-1.7
-1.5
-1.9
-1.2
-3.9
925
3.2
2009 Q2
84.3
-30.6
93.8
-23.4
-3.0
101.6
-2.0
-1.4
-2.4
-2.1
-5.5
948
0.2
Q3
90.3
-21.4
96.1
-18.9
-3.4
101.5
-1.9
-1.3
-2.4
-2.8
-3.2
962
10.1
Q4
91.9
-2.8
97.5
-9.2
-1.5
101.8
-0.5
-0.3
-0.6
0.4
-0.8
966
20.7

2010 Q1
95.5
13.8
100.9
6.4
0.6
102.1
0.7
1.3
0.5
3.2
0.9
892
7.4
2009 Dec.
93.5
9.8
97.7
-2.9
-0.4
102.2
0.3
0.9
0.0
1.9
0.2
952
19.8
2010 Jan.
92.2
7.5
99.2
1.1
-1.0
101.9
-0.3
0.7
-0.7
2.3
-1.5
859
8.3
Feb.
94.6
12.6
100.3
6.1
0.2
101.9
0.3
0.6
0.4
2.0
0.6
878
2.9
Mar.
99.5
20.5
103.2
11.1
2.4
102.6
2.0
2.7
1.8
5.4
3.5
938
10.2
Apr.
100.0
21.7
101.1
10.1
0.2
101.8
-0.1
-0.1
-0.1
-0.4
0.9
839
-10.1

May
. .
. .
0.7
102.1
0.6
0.3
1.0
.
. 787
-13.1

month-on-month percentage changes (s.a.)
2010 Jan.
- -1.4
- 1.5
-0.3
- -0.3
-0.2
-0.3
1.2
-1.4
-
-9.7
Feb.
- 2.6
- 1.1
0.2
- 0.0
-0.1
0.1
-1.0
0.5
-
2.2
Mar.
- 5.2
- 2.9
0.8
- 0.6
0.5
0.6
1.9
1.2
-
6.8
Apr.
- 0.5
- -2.0
-0.8
- -0.8
-0.6
-0.8
-2.6
-1.0
-
-10.5

May
- .
- .
0.3
-
0.3
0.2
0.4
.
.
-
-6.2
Sources: Eurostat, except columns 12 and 13 in Table 4 in Section 5.2 (which comprise ECB calculations based on data from the European Automobile Manufacturers’ Association).
1)
In 2005.
2)
Includes manufacturing industries working mainly on the basis of orders, which represented 61.2% of total manufacturing in 2005.
3)
Annual and quarterly figures are averages of monthly figures in the period concerned.
ECB
S Monthly Bulletin
52 July 2010

EURO AREA
STATISTICS
Prices, output,
demand and
labour markets
5.2 Output and demand
(percentage balances, 1) unless otherwise indicated; seasonally adjusted)
5. Business 2) and Consumer Surveys

Economic
Manufacturing industry
Consumer confidence indicator
sentiment

indicator 3)
Industrial confidence indicator
Capacity
Total 5)
Financial
Economic Unemployment
Savings
(long-term
utilisation 4)
situation
situation
situation
over next
average
Total 5)
Order
Stocks of
Production
(%)
over next
over next
over next
12 months
= 100)
books
finished
expectations
12 months
12 months
12 months
products
1
2
3
4
5
6
7
8
9
10
11
2006
107.2
2
0
6
13
83.2
-9
-3
-9
15
-9
2007
109.2
5
5
5
13
84.2
-5
-2
-4
5
-8
2008
93.5
-9
-15
11
-2
81.8
-18
-10
-25
24
-14

2009
80.8
-28
-56
14
-15
71.1
-25
-7
-26
56
-10
2009 Q2
75.6
-33
-62
18
-20
69.9
-28
-9
-34
59
-11
Q3
84.1
-26
-58
12
-9
70.3
-21
-5
-20
51
-9
Q4
91.9
-19
-50
7
1
71.7
-17
-3
-11
48
-7

2010 Q1
96.6
-12
-41
2
7
73.9
-17
-4
-11
46
-7
Q2
99.2
-7
-29
0
10
. -17
-6
-18
34
-9
2010 Jan.
96.0
-14
-44
3
5
72.3
-16
-3
-9
46
-6
Feb.
95.9
-13
-42
4
7
- -17
-4
-12
47
-7
Mar.
97.9
-10
-39
0
9
- -17
-5
-12
46
-7
Apr.
100.6
-7
-32
-1
9
75.5
-15
-5
-12
36
-8
May
98.4
-6
-28
1
10
- -18
-7
-21
34
-10

June
98.7
-6
-26
1
10
- -17
-7
-20
32
-9

Construction confidence indicator
Retail trade confidence indicator
Services confidence indicator
Total 5)
Order
Employment
Total 5)
Present
Volume of
Expected
Total 5)
Business
Demand in
Demand in
books
expectations
business
stocks
business
climate
recent
the months
situation
situation
months
ahead
12
13
14
15
16
17
18
19
20
21
22
2006
1
-4
6
1
3
14
13
18
13
18
24
2007
0
-7
7
1
5
15
13
20
16
19
24
2008
-13
-20
-6
-7
-6
17
2
2
-5
4
7

2009
-31
-40
-22
-15
-21
11
-15
-16
-22
-16
-9
2009 Q2
-33
-42
-24
-17
-23
9
-19
-22
-29
-23
-15
Q3
-31
-41
-22
-14
-19
10
-13
-12
-18
-13
-5
Q4
-28
-40
-16
-12
-19
10
-7
-4
-8
-8
3

2010 Q1
-27
-37
-17
-7
-9
8
-2
0
-4
-2
7
Q2
-28
-40
-16
-4
-5
8
0
4
1
4
8
2010 Jan.
-29
-38
-20
-5
-6
8
-2
-1
-6
-2
5
Feb.
-29
-39
-18
-9
-12
9
-5
1
-2
-3
7
Mar.
-25
-35
-14
-6
-9
9
-1
1
-3
-1
8
Apr.
-25
-37
-13
-1
-1
8
4
6
0
5
11
May
-28
-40
-17
-6
-7
10
-1
4
-1
4
8

June
-30
-43
-17
-6
-7
8
-3
4
2
4
6
Source: European Commission (Economic and Financial Affairs DG).
1)
Difference between the percentages of respondents giving positive and negative replies.
2)
From May 2010 onwards, data refer to the new version of the classification of economic activitites in the European Union ("NACE Revision 2").
3)
The economic sentiment indicator is composed of the industrial, services, consumer, construction and retail trade confidence indicators; the industrial confidence indicator has
a weight of 40%, the services confidence indicator a weight of 30%, the consumer confidence indicator a weight of 20% and the two other indicators a weight of 5% each.
Values for the economic sentiment indicator of above (below) 100 indicate above-average (below-average) economic sentiment, calculated for the period 1990 to 2008.
4)
Data are collected in January, April, July and October each year. The quarterly figures shown are averages of two successive surveys. Annual data are derived from quarterly
averages.
5)
The confidence indicators are calculated as simple averages of the components shown; the assessments of stocks (columns 4 and 17) and unemployment (column 10) are used
with inverted signs for the calculation of confidence indicators.
ECB
Monthly Bulletin
July 2010 S 53

5.3 Labour markets 1)
(annual percentage changes, unless otherwise indicated)
1. Employment in terms of persons employed

Whole economy
By employment status
By economic activity
Total
Total Employees
Self-
Agriculture,
Mining, Construction
Trade, repairs,
Financial, real
Public
(s.a.; millions)
employed
hunting,
manufacturing
hotels and
estate, renting
administration,
forestry
and energy
restaurants,
and business
education, health
and fishing
transport and
services
and other services
communication
% of total 2)
100.0
100.0
85.3
14.7
3.8
17.1
7.5
25.5
16.1
30.0
1
2
3
4
5
6
7
8
9
10
2007
146.754
1.8
2.0
0.7
-1.6
0.3
3.6
1.9
4.3
1.3
2008
147.846
0.7
0.9
-0.3
-1.8
0.0
-2.3
1.2
2.3
1.1

2009
145.079
-1.9
-1.8
-2.1
-2.2
-5.1
-6.7
-1.8
-2.2
1.3
2009 Q2
145.362
-1.9
-1.9
-2.1
-2.0
-4.9
-7.2
-1.9
-2.4
1.4
Q3
144.587
-2.3
-2.3
-2.3
-2.6
-6.4
-7.3
-1.9
-2.8
1.4
Q4
144.258
-2.0
-2.0
-2.1
-2.0
-6.1
-5.4
-2.0
-2.1
1.0

2010 Q1
144.261
-1.2
-1.2
-0.9
-1.1
-5.3
-4.3
-1.3
-0.4
1.5

quarter-on-quarter percentage changes (s.a.)
2009 Q2
-0.752
-0.5
-0.5
-0.5
-0.7
-1.7
-1.3
-0.5
-0.7
0.4
Q3
-0.775
-0.5
-0.5
-0.6
-1.2
-1.7
-1.7
-0.3
-0.5
0.3
Q4
-0.329
-0.2
-0.2
-0.3
0.3
-1.1
-0.4
-0.6
0.2
0.2

2010 Q1
0.004
0.0
-0.1
0.4
0.1
-0.9
-1.5
0.0
0.5
0.5
2. Employment in terms of hours worked

Whole economy
By employment status
By economic activity
Total
Total Employees
Self-
Agriculture,
Mining, Construction
Trade, repairs,
Financial, real
Public
(s.a.; millions)
employed
hunting,
manufacturing
hotels and
estate, renting
administration,
forestry
and energy
restaurants,
and business
education, health
and fishing
transport and
services
and other services
communication
% of total 2)
100.0
100.0
80.4
19.6
5.0
17.1
8.4
26.9
15.6
27.0
1
2
3
4
5
6
7
8
9
10
2007
237,005.4
1.8
2.0
0.8
-2.3
0.6
3.6
1.9
4.3
1.1
2008
238,642.1
0.7
1.0
-0.6
-2.0
-0.5
-2.0
1.0
2.6
1.4

2009
230,970.5
-3.2
-3.3
-2.7
-2.2
-8.7
-8.3
-2.5
-3.4
1.1
2009 Q2
57,761.5
-4.1
-4.5
-2.7
-1.3
-11.1
-9.3
-3.1
-4.3
0.6
Q3
57,578.7
-3.5
-3.7
-2.8
-2.6
-9.9
-8.6
-2.6
-4.2
1.3

Q4
57,653.2
-2.2
-2.3
-1.8
-1.8
-6.2
-6.0
-1.7
-2.6
1.1
2010 Q1
57,622.3
-0.4
-0.5
-0.2
-2.6
-3.1
-3.7
-0.3
-0.1
2.1

quarter-on-quarter percentage changes (s.a.)
2009 Q2
-215.7
-0.4
-0.5
0.1
0.0
-1.9
-0.2
-0.2
-0.7
0.5
Q3
-182.8
-0.3
-0.3
-0.6
-1.3
-0.8
-1.1
-0.4
-0.5
0.5
Q4
74.5
0.1
0.2
0.0
-0.2
-0.3
-0.5
0.0
0.6
0.4

2010 Q1
-30.9
-0.1
0.0
-0.1
-1.1
-0.5
-1.9
0.0
0.4
0.6
3. Hours worked per person employed

Whole economy
By employment status
By economic activity
Total
Total Employees
Self-
Agriculture,
Mining, Construction
Trade, repairs,
Financial, real
Public
(s.a.; thousands)
employed
hunting,
manufacturing
hotels and
estate, renting
administration,
forestry
and energy
restaurants,
and business
education, health
and fishing
transport and
services
and other services
communication
1
2
3
4
5
6
7
8
9
10
2007
1.615
0.0
0.0
0.2
-0.7
0.3
0.0
0.0
0.0
-0.1
2008
1.614
-0.1
0.1
-0.3
-0.2
-0.5
0.3
-0.2
0.3
0.3

2009
1.592
-1.4
-1.5
-0.6
-0.1
-3.8
-1.7
-0.7
-1.2
-0.3
2009 Q2
0.397
-2.3
-2.7
-0.7
0.7
-6.6
-2.3
-1.2
-1.9
-0.9
Q3
0.398
-1.3
-1.5
-0.5
-0.1
-3.8
-1.4
-0.7
-1.4
-0.1
Q4
0.400
-0.1
-0.3
0.3
0.2
-0.1
-0.6
0.3
-0.5
0.1

2010 Q1
0.399
0.8
0.8
0.7
-1.5
2.3
0.6
1.0
0.4
0.6
Source: Eurostat.
1)
Data for employment are based on the ESA 95.
2)
In 2009.
ECB
S Monthly Bulletin
54 July 2010

EURO AREA
STATISTICS
Prices, output,
demand and
labour markets
5.3 Labour markets
4. Unemployment 1)
(seasonally adjusted)

Total
By age 3)
By gender 4)

Millions
% of labour
Adult
Youth
Male
Female
force
Millions % of labour
Millions
% of labour
Millions
% of labour
Millions
% of labour
force
force
force
force
% of total 2)
100.0
78.4
21.6
53.8
46.2
1
2
3
4
5
6
7
8
9
10
2006
12.878
8.3
10.054
7.3
2.824
16.4
6.390
7.5
6.488
9.4
2007
11.664
7.5
9.113
6.6
2.551
14.9
5.730
6.7
5.934
8.5
2008
11.895
7.6
9.269
6.6
2.625
15.4
5.998
6.9
5.896
8.3

2009
14.864
9.4
11.645
8.2
3.220
19.4
7.996
9.3
6.868
9.6
2009 Q1
13.888
8.8
10.802
7.7
3.086
18.3
7.354
8.5
6.534
9.2
Q2
14.779
9.3
11.538
8.2
3.241
19.4
7.961
9.2
6.817
9.5
Q3
15.277
9.7
11.986
8.5
3.290
19.9
8.246
9.6
7.031
9.8
Q4
15.513
9.8
12.252
8.7
3.260
19.9
8.423
9.8
7.090
9.9

2010 Q1
15.696
9.9
12.444
8.8
3.253
20.0
8.493
9.9
7.204
10.0
2009 Dec.
15.555
9.9
12.309
8.7
3.246
19.9
8.436
9.8
7.119
9.9
2010 Jan.
15.624
9.9
12.376
8.7
3.249
20.0
8.474
9.8
7.150
10.0
Feb.
15.705
9.9
12.430
8.8
3.275
20.2
8.514
9.9
7.191
10.0
Mar.
15.760
10.0
12.526
8.8
3.234
20.0
8.490
9.9
7.270
10.1
Apr.
15.754
10.0
12.528
8.8
3.227
20.0
8.475
9.9
7.279
10.1

May
15.789
10.0
12.588
8.9
3.201
19.9
8.475
9.9
7.314
10.2
Source: Eurostat.
1)
Data for unemployment refer to persons and follow ILO recommendations.
2)
In 2009.
3)
Adult: 25 years of age and over; youth: below 25 years of age; rates are expressed as a percentage of the labour force for the relevant age group.
4)
Rates are expressed as a percentage of the labour force for the relevant gender.
ECB
Monthly Bulletin
July 2010 S 55

6 GOVERNMENT FINANCE
6.1 Revenue, expenditure and deficit/surplus 1)
(as a percentage of GDP)
1. Euro area _ revenue

Total
Current revenue
Capital revenue
Memo

item:
Direct
Indirect
Social
Sales
Capital
Fiscal
taxes Households Corporations
taxes Received by EU contributions Employers Employees
taxes burden 2)
institutions
1
2
3
4
5
6
7
8
9
10
11
12
13
14
2001
45.7
45.4
12.2
9.4
2.8
13.5
0.5
15.6
8.2
4.7
2.1
0.2
0.3
41.6
2002
45.1
44.8
11.8
9.2
2.5
13.5
0.4
15.6
8.2
4.6
2.1
0.3
0.3
41.2
2003
45.0
44.4
11.4
9.0
2.3
13.5
0.4
15.7
8.3
4.6
2.1
0.6
0.5
41.1
2004
44.5
44.0
11.3
8.7
2.5
13.5
0.3
15.5
8.2
4.5
2.1
0.5
0.4
40.7
2005
44.8
44.3
11.5
8.8
2.7
13.7
0.3
15.4
8.1
4.5
2.2
0.5
0.3
40.9
2006
45.3
45.0
12.1
8.9
3.0
13.9
0.3
15.3
8.1
4.5
2.1
0.3
0.3
41.5
2007
45.4
45.2
12.4
9.1
3.2
13.8
0.3
15.1
8.0
4.4
2.1
0.3
0.3
41.6
2008
44.9
44.7
12.2
9.3
2.8
13.3
0.3
15.3
8.1
4.5
2.1
0.2
0.3
41.0

2009
44.5
44.2
11.4
9.2
2.0
13.1
0.3
15.7
8.3
4.5
2.2
0.3
0.4
40.5
2. Euro area _ expenditure

Total
Current expenditure
Capital expenditure
Memo

item:
Total Compensation Intermediate Interest
Current

Investment
Capital
Primary
of consumption
transfers
Social Subsidies
transfers
Paid by EU expenditure 3)
employees
payments
Paid by EU
institutions
institutions
1
2
3
4
5
6
7
8
9
10
11
12
13
14
2001
47.6
43.7
10.3
4.8
3.8
24.8
21.7
1.9
0.5
3.9
2.5
1.4
0.0
43.8
2002
47.7
43.9
10.4
4.9
3.5
25.1
22.2
1.9
0.5
3.8
2.4
1.4
0.0
44.2
2003
48.1
44.1
10.5
5.0
3.3
25.4
22.5
1.9
0.5
3.9
2.5
1.4
0.1
44.8
2004
47.5
43.6
10.4
5.0
3.1
25.1
22.3
1.8
0.5
3.9
2.4
1.5
0.1
44.4
2005
47.4
43.5
10.4
5.0
3.0
25.0
22.3
1.7
0.5
3.9
2.5
1.4
0.0
44.4
2006
46.7
42.9
10.2
5.0
2.9
24.8
22.0
1.7
0.5
3.8
2.5
1.4
0.0
43.8
2007
46.1
42.3
10.0
5.0
3.0
24.4
21.6
1.6
0.4
3.8
2.6
1.2
0.0
43.1
2008
46.9
43.1
10.1
5.1
3.0
24.8
22.0
1.6
0.4
3.8
2.5
1.3
0.0
43.9

2009
50.8
46.6
10.8
5.6
2.8
27.3
24.2
1.9
0.5
4.2
2.8
1.4
0.0
48.0
3. Euro area _ deficit/surplus, primary deficit/surplus and government consumption

Deficit (-)/surplus (+)
Primary
Government consumption 4)
deficit (-)/

Total Central
State
Local
Social surplus (+)
Total
Collective
Individual
gov.
gov.
gov. security
Compensation Intermediate
Transfers Consumption
Sales consumption consumption
funds
of employees consumption
in kind
of fixed
(minus)
via market
capital
producers
1
2
3
4
5
6
7
8
9
10
11
12
13
14
2001
-1.9
-1.7
-0.4
-0.1
0.3
1.9
19.9
10.3
4.8
4.9
1.8
2.1
8.2
11.7
2002
-2.6
-2.1
-0.5
-0.2
0.2
0.9
20.2
10.4
4.9
5.1
1.8
2.1
8.3
12.0
2003
-3.1
-2.4
-0.5
-0.2
0.0
0.2
20.5
10.5
5.0
5.2
1.8
2.1
8.3
12.2
2004
-3.0
-2.5
-0.4
-0.3
0.2
0.2
20.4
10.4
5.0
5.1
1.9
2.1
8.3
12.1
2005
-2.6
-2.2
-0.3
-0.2
0.2
0.4
20.4
10.4
5.0
5.1
1.9
2.2
8.2
12.3
2006
-1.3
-1.5
-0.1
-0.2
0.4
1.6
20.3
10.2
5.0
5.2
1.9
2.1
8.0
12.2
2007
-0.6
-1.1
0.0
-0.1
0.5
2.3
20.0
10.0
5.0
5.2
1.9
2.1
7.9
12.1
2008
-2.0
-2.0
-0.2
-0.2
0.4
1.0
20.5
10.1
5.1
5.3
1.9
2.1
8.1
12.4

2009
-6.2
-5.0
-0.5
-0.3
-0.4
-3.4
22.1
10.8
5.6
5.8
2.0
2.2
8.8
13.3
4. Euro area countries _ deficit (-)/surplus (+) 5)
BE
DE
IE
GR
ES
FR
IT
CY
LU
MT
NL
AT
PT
SI
SK
FI
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
2006
0.3
-1.6
3.0
-3.6
2.0
-2.3
-3.3
-1.2
1.4
-2.6
0.5
-1.5
-3.9
-1.3
-3.5
4.0
2007
-0.2
0.2
0.1
-5.1
1.9
-2.7
-1.5
3.4
3.6
-2.2
0.2
-0.4
-2.6
0.0
-1.9
5.2
2008
-1.2
0.0
-7.3
-7.7
-4.1
-3.3
-2.7
0.9
2.9
-4.5
0.7
-0.4
-2.8
-1.7
-2.3
4.2

2009
-6.0
-3.3
-14.3
-13.6
-11.2
-7.5
-5.3
-6.1
-0.7
-3.8
-5.3
-3.4
-9.4
-5.5
-6.8
-2.2
Sources: ECB for euro area aggregated data; European Commission for data relating to countries’ deficit/surplus.
1)
Data refer to the Euro 16. The concepts "revenue", "expenditure" and "deficit/surplus" are based on the ESA 95. Transactions involving the EU budget are included and
consolidated. Transactions among Member States’ governments are not consolidated.
2)
The fiscal burden comprises taxes and social contributions.
3)
Comprises total expenditure minus interest expenditure.
4)
Corresponds to final consumption expenditure (P.3) of general government in the ESA 95.
5)
Includes proceeds from the sale of UMTS licences and settlements under swaps and forward rate agreements.
ECB
S Monthly Bulletin
56 July 2010

EURO AREA
STATISTICS
Government
finance
6.2 Debt 1)
(as a percentage of GDP)
1. Euro area _ by financial instrument and sector of the holder

Total
Financial instruments
Holders

Currency
Loans
Short-term
Long-term
Domestic creditors 2) Other
and
securities
securities
creditors 3)
deposits
Total
MFIs
Other
Other
financial
sectors
corporations
1
2
3
4
5
6
7
8
9
10
2000
69.2
2.7
13.2
3.7
49.6
43.9
22.1
12.3
9.5
25.4
2001
68.2
2.8
12.4
4.0
49.0
42.0
20.6
11.0
10.4
26.2
2002
68.0
2.7
11.8
4.6
48.9
40.5
19.4
10.6
10.5
27.4
2003
69.1
2.1
12.4
5.0
49.6
39.7
19.6
11.0
9.1
29.3
2004
69.5
2.2
12.0
5.0
50.3
38.2
18.5
10.7
9.0
31.3
2005
70.1
2.4
11.8
4.7
51.1
36.3
17.2
11.1
8.0
33.8
2006
68.2
2.4
11.5
4.1
50.2
34.4
17.4
9.3
7.7
33.8
2007
65.9
2.2
10.8
4.2
48.7
32.6
16.7
8.5
7.3
33.4
2008
69.4
2.3
11.0
6.7
49.4
32.4
16.6
7.9
7.8
37.0

2009
78.8
2.4
11.9
8.6
55.8
36.6
19.7
8.7
8.2
42.2
2. Euro area _ by issuer, maturity and currency denomination

Total
Issued by: 4)
Original maturity
Residual maturity
Currencies

Central
State
Local
Social
Up to
Over
Up to
Over 1 and
Over
Euro or
Other
gov.
gov.
gov.
security
1 year
1 year
Variable
1 year
up to 5 years
5 years
participating
currencies
funds
interest rate
currencies
1
2
3
4
5
6
7
8
9
10
11
12
13
2000
69.2
58.2
5.8
4.9
0.4
6.5
62.7
6.2
13.4
27.8
28.1
67.4
1.8
2001
68.2
57.1
6.0
4.7
0.4
7.0
61.2
5.3
13.7
26.6
27.9
66.7
1.5
2002
68.0
56.7
6.2
4.7
0.4
7.6
60.4
5.2
15.5
25.3
27.2
66.7
1.3
2003
69.1
56.9
6.5
5.1
0.6
7.8
61.3
5.0
14.9
26.0
28.2
68.2
0.9
2004
69.5
57.3
6.6
5.1
0.4
7.8
61.6
4.7
14.8
26.2
28.5
68.6
0.9
2005
70.1
57.6
6.7
5.2
0.5
7.9
62.2
4.6
14.8
25.5
29.7
69.1
1.0
2006
68.2
55.9
6.5
5.3
0.5
7.4
60.8
4.3
14.4
24.0
29.8
67.7
0.6
2007
65.9
54.0
6.2
5.2
0.5
7.4
58.5
4.3
14.6
23.5
27.8
65.4
0.5
2008
69.4
57.2
6.6
5.2
0.4
10.2
59.2
4.4
17.8
23.3
28.4
68.6
0.8

2009
78.8
64.9
7.6
5.6
0.6
12.2
66.5
4.5
19.8
26.7
32.2
78.0
0.8
3. Euro area countries
BE
DE
IE
GR
ES
FR
IT
CY
LU
MT
NL
AT
PT
SI
SK
FI
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
2006
88.1
67.6
24.9
97.8
39.6
63.7
106.5
64.6
6.5
63.7
47.4
62.2
64.7
26.7
30.5
39.7
2007
84.2
65.0
25.0
95.7
36.2
63.8
103.5
58.3
6.7
61.9
45.5
59.5
63.6
23.4
29.3
35.2
2008
89.8
66.0
43.9
99.2
39.7
67.5
106.1
48.4
13.7
63.7
58.2
62.6
66.3
22.6
27.7
34.2

2009
96.7
73.2
64.0
115.1
53.2
77.6
115.8
56.2
14.5
69.1
60.9
66.5
76.8
35.9
35.7
44.0
Sources: ECB for euro area aggregated data; European Commission for data relating to countries’ debt.
1)
Data refer to the Euro 16. Gross general government debt at nominal value and consolidated between sub-sectors of government. Holdings by non-resident governments are
not consolidated. Data are partially estimated.
2)
Holders resident in the country whose government has issued the debt.
3)
Includes residents of euro area countries other than the country whose government has issued the debt.
4)
Excludes debt held by general government in the country whose government has issued it.
ECB
Monthly Bulletin
July 2010 S 57

6.3 Change in debt 1)
(as a percentage of GDP)
1. Euro area _ by source, financial instrument and sector of the holder

Total
Source of change
Financial instruments
Holders

Borrowing
Valuation
Other
Currency
Loans Short-term
Long-term
Domestic
Other
requirement 2)
effects 3)
changes
and
securities
securities
creditors 5)
MFIs
Other
creditors 6)
in
deposits
financial
volume 4)
corporations
1
2
3
4
5
6
7
8
9
10
11
12
2001
1.9
1.9
-0.1
0.1
0.2
-0.2
0.5
1.5
0.0
-0.5
-0.8
1.9
2002
2.1
2.7
-0.5
0.0
0.0
-0.2
0.7
1.6
0.0
-0.5
-0.1
2.1
2003
3.1
3.3
-0.2
0.0
-0.6
0.9
0.6
2.1
0.4
0.8
0.8
2.7
2004
3.1
3.2
-0.1
0.0
0.2
0.1
0.1
2.7
0.1
-0.3
0.1
3.1
2005
3.1
3.0
0.0
0.0
0.3
0.3
-0.1
2.6
-0.6
-0.7
0.8
3.6
2006
1.5
1.4
0.1
0.0
0.2
0.2
-0.4
1.5
-0.1
1.0
-1.2
1.6
2007
1.1
1.1
0.0
0.0
-0.1
-0.1
0.3
1.0
-0.2
0.2
-0.3
1.2
2008
5.2
5.1
0.1
0.0
0.1
0.4
2.6
2.0
0.7
0.4
-0.4
4.5

2009
7.1
7.3
-0.2
0.0
0.1
0.6
1.6
4.8
3.1
2.5
0.5
4.0
2. Euro area _ deficit-debt adjustment

Change in
Deficit (-) /
Deficit-debt adjustment 8)
debt surplus (+) 7)

Total
Transactions in main financial assets held by general government
Valuation
Other
Other 9)

effects
Exchange
changes in
Total
Currency
Loans
Securities 10)
Shares and
rate
volume
and
other Privatisations
Equity
effects
deposits
equity
injections
1
2
3
4
5
6
7
8
9
10
11
12
13
14
2001
1.9
-1.9
0.0
-0.5
-0.6
0.1
0.1
-0.1
-0.3
0.1
-0.1
0.0
0.1
0.6
2002
2.1
-2.6
-0.5
0.1
0.1
0.0
0.0
-0.1
-0.4
0.1
-0.5
-0.1
0.0
0.0
2003
3.1
-3.1
0.0
0.1
0.1
0.0
0.0
0.1
-0.2
0.1
-0.2
-0.1
0.0
0.1
2004
3.1
-3.0
0.2
0.2
0.2
0.0
0.1
0.0
-0.5
0.2
-0.1
0.0
0.0
0.1
2005
3.1
-2.6
0.5
0.6
0.3
0.1
0.2
0.1
-0.3
0.2
0.0
0.0
0.0
-0.1
2006
1.5
-1.3
0.2
0.3
0.3
-0.1
0.3
-0.2
-0.4
0.1
0.1
0.0
0.0
-0.2
2007
1.1
-0.6
0.4
0.6
0.2
0.0
0.2
0.1
-0.2
0.2
0.0
0.0
0.0
-0.1
2008
5.2
-2.0
3.3
3.1
0.8
0.7
0.8
0.8
0.0
0.6
0.1
0.0
0.0
0.1

2009
7.1
-6.2
0.9
1.0
0.4
0.0
0.2
0.4
-0.2
0.5
-0.2
0.0
0.0
0.0
Source: ECB.
1)
Data refer to the Euro 16 and are partially estimated. Annual change in gross nominal consolidated debt is expressed as a percentage of GDP, i.e. [debt(t) - debt(t-1)] ÷ GDP(t).
2)
The borrowing requirement is by definition equal to transactions in debt.
3)
Includes, in addition to the impact of foreign exchange movements, effects arising from measurement at nominal value (e.g. premia or discounts on securities issued).
4)
Includes, in particular, the impact of the reclassification of units and certain types of debt assumption.
5)
Holders resident in the country whose government has issued the debt.
6)
Includes residents of euro area countries other than the country whose government has issued the debt.
7)
Including proceeds from sales of UMTS licences.
8)
The difference between the annual change in gross nominal consolidated debt and the deficit as a percentage of GDP.
9)
Mainly composed of transactions in other assets and liabilities (trade credits, other receivables/payables and financial derivatives).
10) Excluding financial derivatives.
ECB
S Monthly Bulletin
58 July 2010

EURO AREA
STATISTICS
Government
finance
6.4 Quarterly revenue, expenditure and deficit/surplus 1)
(as a percentage of GDP)
1. Euro area _ quarterly revenue

Total
Current revenue
Capital revenue
Memo
item:
Direct taxes
Indirect taxes
Social
Sales
Property
Capital
Fiscal
contributions
income
taxes
burden 2)
1
2
3
4
5
6
7
8
9
10
2003 Q4
49.2
48.2
13.1
14.1
16.2
2.9
0.8
1.0
0.3
43.7
2004 Q1
41.4
40.9
9.5
12.9
15.3
1.7
0.6
0.4
0.3
38.0
Q2
44.7
44.0
11.9
12.9
15.3
2.0
1.1
0.8
0.6
40.7
Q3
42.8
42.4
10.7
12.8
15.4
1.9
0.7
0.5
0.3
39.2
Q4
49.0
48.0
12.9
14.2
16.2
2.9
0.7
1.0
0.4
43.7
2005 Q1
42.0
41.5
10.0
13.0
15.2
1.7
0.6
0.5
0.3
38.5
Q2
44.3
43.7
11.5
13.2
15.1
2.0
1.1
0.6
0.3
40.1
Q3
43.6
42.9
11.1
13.0
15.2
1.9
0.7
0.7
0.3
39.7
Q4
49.0
48.3
13.3
14.2
16.1
2.9
0.8
0.8
0.3
43.9
2006 Q1
42.4
42.0
10.3
13.4
15.1
1.6
0.8
0.4
0.3
39.0
Q2
45.4
44.9
12.2
13.5
15.1
1.9
1.3
0.5
0.3
41.1
Q3
43.8
43.3
11.6
13.0
15.2
2.0
0.8
0.5
0.3
40.0
Q4
49.3
48.7
14.0
14.3
15.8
2.9
0.9
0.6
0.3
44.4
2007 Q1
42.1
41.7
10.2
13.5
14.8
1.7
0.8
0.3
0.3
38.8
Q2
45.6
45.2
12.7
13.5
15.0
1.8
1.5
0.4
0.3
41.4
Q3
43.8
43.3
12.2
12.8
14.9
1.9
0.8
0.5
0.3
40.1
Q4
49.8
49.1
14.4
14.1
15.8
3.0
0.9
0.6
0.3
44.6
2008 Q1
42.4
41.9
10.7
12.9
14.8
1.7
1.0
0.5
0.2
38.6
Q2
45.1
44.6
12.6
12.8
15.0
1.9
1.5
0.5
0.3
40.7
Q3
43.3
42.9
11.9
12.4
15.1
1.9
0.8
0.3
0.3
39.7
Q4
48.6
48.4
13.6
13.6
16.3
3.0
1.0
0.2
0.3
43.7
2009 Q1
41.2
41.8
10.2
12.5
15.4
1.8
1.0
-0.6
0.2
38.4
Q2
43.8
43.9
11.5
12.6
15.5
2.0
1.5
-0.1
0.5
40.1
Q3
42.8
42.4
10.9
12.3
15.5
2.0
0.8
0.4
0.3
39.1

Q4
49.8
47.9
12.7
13.6
16.4
3.2
0.9
1.9
0.5
43.2
2. Euro area _ quarterly expenditure and deficit/surplus

Total
Current expenditure
Capital expenditure
Deficit (-)/
Primary

surplus (+)
deficit (-)/
Total Compensation
Intermediate
Interest
Current
Investment
Capital
surplus (+)
of consumption
transfers
Social Subsidies
transfers
employees
benefits
1
2
3
4
5
6
7
8
9
10
11
12
13
2003 Q4
51.1
46.3
11.1
5.7
3.1
26.4
22.8
1.5
4.8
3.3
1.6
-1.9
1.2
2004 Q1
46.3
43.0
10.3
4.6
3.2
24.9
21.3
1.2
3.4
1.9
1.5
-5.0
-1.8
Q2
46.6
43.2
10.4
4.8
3.3
24.7
21.4
1.3
3.4
2.3
1.1
-1.8
1.4
Q3
46.1
42.7
9.9
4.7
3.1
24.9
21.5
1.3
3.4
2.4
1.0
-3.2
-0.1
Q4
50.9
45.6
11.0
5.7
2.9
26.1
22.6
1.4
5.2
3.1
2.1
-1.9
1.0
2005 Q1
46.7
43.0
10.2
4.6
3.1
25.1
21.3
1.2
3.7
1.9
1.8
-4.8
-1.7
Q2
46.2
42.8
10.2
4.9
3.2
24.5
21.3
1.1
3.4
2.3
1.1
-1.8
1.3
Q3
45.8
42.4
9.9
4.8
3.0
24.7
21.3
1.2
3.4
2.5
1.0
-2.2
0.7
Q4
50.5
45.7
11.1
5.8
2.7
26.1
22.5
1.3
4.8
3.1
1.7
-1.5
1.2
2006 Q1
45.3
42.1
10.0
4.6
3.0
24.6
21.1
1.2
3.1
1.9
1.2
-2.9
0.1
Q2
45.4
42.2
10.2
4.9
3.1
24.0
21.0
1.1
3.2
2.3
1.0
-0.1
3.0
Q3
45.4
42.0
9.8
4.7
2.9
24.5
21.1
1.2
3.4
2.4
1.0
-1.5
1.4
Q4
50.3
45.0
10.7
5.7
2.7
25.9
22.2
1.4
5.3
3.2
2.2
-1.0
1.7
2007 Q1
44.2
41.1
9.8
4.5
2.9
23.8
20.4
1.2
3.1
2.0
1.1
-2.2
0.8
Q2
44.6
41.4
9.9
4.8
3.2
23.5
20.5
1.1
3.1
2.3
0.8
1.1
4.3
Q3
44.6
41.2
9.6
4.8
2.9
24.0
20.7
1.2
3.4
2.5
0.9
-0.9
2.1
Q4
50.4
45.2
10.7
5.8
2.8
26.0
22.2
1.5
5.2
3.4
1.8
-0.6
2.1
2008 Q1
44.8
41.4
9.7
4.6
3.0
24.1
20.5
1.2
3.3
2.0
1.4
-2.4
0.6
Q2
45.4
41.9
10.1
5.0
3.2
23.7
20.6
1.1
3.5
2.3
1.2
-0.3
2.9
Q3
45.5
42.0
9.7
4.8
3.1
24.4
21.2
1.2
3.5
2.5
1.0
-2.2
0.8
Q4
51.5
46.8
11.0
6.1
2.8
27.0
23.0
1.4
4.7
3.4
1.4
-3.0
-0.2
2009 Q1
47.6
44.9
10.5
5.2
2.9
26.3
22.4
1.3
2.7
2.2
0.4
-6.4
-3.5
Q2
49.5
46.1
10.9
5.5
3.2
26.6
23.1
1.3
3.4
2.7
0.6
-5.7
-2.5
Q3
49.4
45.5
10.4
5.2
2.7
27.1
23.5
1.4
3.9
2.6
1.2
-6.6
-3.9

Q4
56.1
49.4
11.4
6.3
2.5
29.2
24.8
1.6
6.7
3.4
3.2
-6.3
-3.7
Sources: ECB calculations based on Eurostat and national data.
1)
The concepts "revenue", "expenditure" and "deficit/surplus" are based on the ESA 95. Transactions between the EU budget and entities outside the government sector
are not included. Otherwise, except for different data transmission deadlines, the quarterly data are consistent with the annual data. The data are not seasonally adjusted.
2)
The fiscal burden comprises taxes and social contributions.
ECB
Monthly Bulletin
July 2010 S 59

6.5 Quarterly debt and change in debt
(as a percentage of GDP)
1. Euro area _ Maastricht debt by financial instrument 1)

Total
Financial instruments
Currency and deposits
Loans
Short-term securities
Long-term securities
1
2
3
4
5
2007 Q1
68.4
2.4
11.5
4.7
49.9
Q2
68.7
2.2
11.2
5.1
50.2
Q3
67.7
2.1
11.0
5.1
49.3
Q4
65.9
2.2
10.8
4.2
48.7
2008 Q1
67.0
2.1
11.2
5.0
48.7
Q2
67.3
2.1
11.2
4.9
49.0
Q3
67.4
2.1
11.1
5.5
48.7
Q4
69.4
2.3
11.0
6.7
49.4
2009 Q1
72.8
2.3
11.3
7.9
51.4
Q2
76.1
2.4
11.6
8.4
53.7
Q3
77.9
2.3
11.7
9.2
54.6

Q4
78.8
2.4
11.9
8.6
55.8
2. Euro area _ deficit-debt adjustment

Change in
Deficit (-)/
Deficit-debt adjustment
Memo
debt
surplus (+)

item:
Total
Transactions in main financial assets held by general government
Valuation effects
Other
Borrowing
and other changes
requirement
Total
Currency
Loans
Securities
Shares and
in volume
and deposits
other equity
1
2
3
4
5
6
7
8
9
10
11
2007 Q1
4.5
-2.2
2.3
1.8
1.1
0.0
0.6
0.1
-0.7
1.2
5.2
Q2
4.2
1.1
5.2
4.9
4.1
0.0
0.5
0.3
0.6
-0.3
3.6
Q3
-0.6
-0.9
-1.4
-1.4
-2.1
0.0
0.4
0.2
0.1
-0.1
-0.6
Q4
-3.5
-0.6
-4.1
-2.9
-2.1
0.0
-0.6
-0.2
0.0
-1.2
-3.4
2008 Q1
6.6
-2.4
4.2
3.3
2.0
0.0
1.1
0.3
0.0
0.9
6.6
Q2
4.0
-0.3
3.7
3.9
1.8
0.3
1.3
0.4
0.1
-0.3
3.9
Q3
2.2
-2.2
0.0
-0.9
-1.6
0.0
0.2
0.5
0.4
0.4
1.8
Q4
8.0
-3.0
5.1
5.8
0.8
2.6
0.5
1.9
0.0
-0.8
8.0
2009 Q1
11.9
-6.4
5.5
6.5
5.1
-0.1
0.9
0.7
-1.3
0.3
13.2
Q2
9.9
-5.7
4.2
3.3
2.5
-0.6
0.2
1.2
0.6
0.4
9.3
Q3
4.7
-6.6
-1.9
-2.9
-3.2
0.7
0.0
-0.4
0.2
0.8
4.5

Q4
2.2
-6.3
-4.1
-2.6
-2.6
0.0
-0.1
0.1
-0.2
-1.3
2.4
C28 Deficit, borrowing requirement and change in debt
C29 Maastricht debt
(four-quarter moving sum as a percentage of GDP)
(annual change in the debt-to-GDP ratio and underlying factors)
deficit-debt adjustment
deficit
primary deficit/surplus
change in debt
growth/interest rate differential
borrowing requirement
change in debt-to-GDP ratio
9.0
9.0
12.0
12.0
8.0
8.0
10.0
10.0
7.0
7.0
8.0
8.0
6.0
6.0
6.0
6.0
5.0
5.0
4.0
4.0
4.0
4.0
2.0
2.0
3.0
3.0
0.0
0.0
2.0
2.0
1.0
1.0
-2.0
-2.0
0.0
0.0
-4.0
-4.0
2001
2002
2003
2004
2005
2006
2007
2008
2009
2001
2002
2003
2004
2005
2006
2007
2008
2009
Sources: ECB calculations based on Eurostat and national data.
1)
The stock data in quarter t are expressed as a percentage of the sum of GDP in t and the previous three quarters.
ECB
S Monthly Bulletin
60 July 2010

EXTERNAL TRANSACTIONS AND POSITIONS
7
7.1 Summary balance of payments 1)
(EUR billions; net transactions)

Current account
Net
Financial account
Capital
lending/
Errors and
Total
Goods Services
Income
Current account
borrowing
Total
Direct
Portfolio
Financial
Other
Reserve
omissions
transfers
to/from
investment investment derivatives investment
assets
rest of
the world
(columns
1+6)
1
2
3
4
5
6
7
8
9
10
11
12
13
14
2007
13.5
48.0
49.6
2.9
-87.0
5.0
18.5
-10.7
-73.7
151.5
-63.7
-19.6
-5.1
-7.8
2008
-153.8
-19.1
41.4
-76.6
-99.5
9.8
-144.0
163.2
-198.7
344.1
-62.5
83.7
-3.4
-19.2
2009
-55.8
39.5
31.4
-38.0
-88.7
8.0
-47.8
45.4
-95.7
317.9
39.9
-221.2
4.5
2.4
2009 Q1
-37.2
-7.6
1.8
-3.0
-28.4
1.5
-35.8
50.9
-64.6
105.8
15.8
-11.8
5.6
-15.1
Q2
-22.0
14.0
6.9
-25.5
-17.3
2.2
-19.8
10.9
0.3
70.8
22.9
-81.7
-1.4
8.9
Q3
-3.6
13.8
12.2
-6.7
-22.8
1.4
-2.2
-12.6
-23.7
78.2
-4.5
-62.9
0.3
14.8
Q4
7.0
19.4
10.6
-2.8
-20.2
3.0
9.9
-3.8
-7.8
63.1
5.8
-64.8
-0.1
-6.2
2010 Q1
-19.6
3.5
5.3
1.2
-29.7
2.7
-16.9
18.1
-26.6
-9.6
3.9
55.1
-4.8
-1.1
2009 Apr.
-9.8
4.1
2.0
-6.6
-9.3
1.6
-8.2
18.1
7.7
-5.3
13.0
1.5
1.2
-9.9
May
-13.7
2.6
3.0
-12.7
-6.7
0.2
-13.5
9.4
17.5
33.8
9.4
-49.1
-2.2
4.1
June
1.5
7.3
1.8
-6.2
-1.3
0.3
1.8
-16.6
-24.8
42.3
0.5
-34.2
-0.4
14.8
July
8.1
14.1
3.9
-3.0
-6.9
0.9
9.0
-19.4
7.2
-26.5
6.4
-2.9
-3.7
10.4
Aug.
-6.1
-1.9
4.1
0.0
-8.3
0.5
-5.5
-10.8
1.7
25.7
-9.8
-29.2
0.8
16.3
Sep.
-5.6
1.5
4.1
-3.7
-7.5
0.0
-5.6
17.6
-32.6
78.9
-1.1
-30.8
3.3
-11.9
Oct.
-0.2
8.5
4.1
0.5
-13.3
0.2
0.0
1.5
-3.0
8.2
1.8
-4.8
-0.6
-1.5
Nov.
-2.4
5.0
1.6
-2.8
-6.1
1.4
-1.0
2.8
-7.4
-6.2
-0.1
15.1
1.4
-1.8
Dec.
9.5
5.9
4.9
-0.5
-0.7
1.4
10.9
-8.1
2.7
61.1
4.1
-75.0
-0.8
-2.8
2010 Jan.
-14.7
-7.4
0.8
-1.1
-7.1
1.7
-13.0
14.5
-3.1
-0.7
5.1
11.7
1.5
-1.5
Feb.
-6.2
5.1
2.0
1.1
-14.3
0.9
-5.3
4.5
0.6
7.5
-0.1
0.1
-3.6
0.7
Mar.
1.3
5.7
2.5
1.3
-8.3
0.1
1.4
-1.0
-24.2
-16.3
-1.1
43.2
-2.6
-0.4

Apr.
-6.9
3.6
2.8
-5.5
-7.8
-0.2
-7.1
8.2
-11.3
29.9
-0.3
-10.1
0.0
-1.1

12-month cumulated transactions

2010 Apr.
-35.3
50.1
35.8
-32.6
-88.5
7.4
-27.9
2.6
-76.8
237.6
14.8
-165.9
-7.1
25.3

12-month cumulated transactions as a percentage of GDP

2010 Apr.
-0.4
0.6
0.4
-0.4
-1.0
0.1
-0.3
0.0
-0.9
2.6
0.2
-1.8
-0.1
0.3
C30 Euro area b.o.p.: current account
C31 Euro area b.o.p.: direct and portfolio investment
(seasonally adjusted; 12-month cumulated transactions as a percentage of GDP)
(12-month cumulated transactions as a percentage of GDP)
net direct investment
current account balance
net portfolio investment
1.0
1.0
6.0
6.0
0.5
0.5
4.0
4.0
0.0
0.0
2.0
2.0
-0.5
-0.5
0.0
0.0
-1.0
-1.0
-2.0
-2.0
-1.5
-1.5
-2.0
-2.0
-4.0
-4.0
2001
2002
2003
2004
2005
2006
2007
2008
2009
2001
2002
2003
2004
2005
2006
2007
2008
2009
Source: ECB.
1)
The sign convention is explained in the General Notes.
ECB
Monthly Bulletin
July 2010 S 61

7.2 Current and capital accounts
(EUR billions; transactions)
1. Summary current and capital accounts

Current account
Capital account

Total
Goods
Services
Income
Current transfers

Credit
Debit
Net
Credit
Debit
Credit
Debit
Credit
Debit
Credit
Debit
Credit
Debit
Workers’
Workers’
remit-
remit-
tances
tances
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
2007
2,702.7 2,689.2
13.5
1,518.0
1,470.1
494.9
445.3
598.7
595.8
91.0
6.4 178.1
20.7
25.7
20.7
2008
2,732.5 2,886.3
-153.8
1,580.4
1,599.5
517.6
476.2
546.1
622.6
88.5
6.7 188.0
21.4
24.2
14.5
2009
2,274.9 2,330.7
-55.8
1,290.1
1,250.5
471.1
439.7
421.0
459.0
92.8
6.1 181.5
21.6
18.9
10.9
2009 Q1
557.1
594.4
-37.2
307.5
315.1
110.4
108.6
113.5
116.4
25.8
1.4
54.2
5.0
4.1
2.6
Q2
559.5
581.4
-22.0
312.5
298.5
114.8
107.9
111.2
136.7
21.0
1.6
38.3
5.4
4.9
2.8
Q3
556.0
559.6
-3.6
322.5
308.7
124.0
111.9
95.1
101.8
14.3
1.6
37.2
5.5
3.9
2.4
Q4
602.3
595.3
7.0
347.6
328.2
121.8
111.3
101.2
104.0
31.7
1.5
51.8
5.7
6.0
3.0

2010 Q1
573.8
593.4
-19.6
347.7
344.2
107.8
102.4
94.6
93.4
23.7
. 53.4
.
5.3
2.6
2010 Feb.
185.0
191.2
-6.2
111.7
106.6
34.2
32.2
30.3
29.2
8.8
. 23.2
.
1.6
0.7
Mar.
214.4
213.2
1.3
135.8
130.1
38.5
36.0
35.6
34.3
4.5
. 12.8
.
1.1
1.0

Apr.
195.1
202.0
-6.9
122.9
119.4
38.1
35.3
30.1
35.5
4.0
. 11.8
.
0.7
0.9
Seasonally adjusted
2009 Q3
551.7
560.1
-8.4
316.2
302.6
115.2
107.1
98.6
108.1
21.8
. 42.3
.
.
.
Q4
573.3
581.0
-7.7
331.6
317.6
118.5
108.2
96.7
107.1
26.5
. 48.1
.
.
.
2010 Q1
600.2
604.9
-4.7
362.5
351.4
118.1
107.0
97.6
102.1
22.0
. 44.4
.
.
.
2010 Feb.
195.1
199.6
-4.5
119.0
113.7
38.7
35.2
32.7
34.2
4.6
. 16.5
.
.
.
Mar.
205.7
204.2
1.5
126.5
123.1
40.1
35.6
32.9
33.8
6.2
. 11.7
.
.
.

Apr.
199.8
204.9
-5.1
124.5
123.2
40.1
36.6
30.0
32.7
5.2
. 12.5
.
.
.

12-month cumulated transactions

2010 Apr.
2,303.1 2,335.4
-32.3
1,347.4
1,298.5
468.6
432.7
395.6
427.5
91.4
. 176.7
.
.
.

12-month cumulated transactions as a percentage of GDP

2010 Apr.
25.6
26.0
-0.4
15.0
14.4
5.2
4.8
4.4
4.8
1.0
. 2.0
.
.
.
C32 Euro area b.o.p.: goods
C33 Euro area b.o.p.: services
(seasonally adjusted; 12-month cumulated transactions as a percentage of GDP)
(seasonally adjusted; 12-month cumulated transactions as a percentage of GDP)
exports (credit)
exports (credit)
imports (debit)
imports (debit)
18.0
18.0
5.8
5.8
5.6
5.6
17.0
17.0
5.4
5.4
16.0
16.0
5.2
5.2
5.0
5.0
15.0
15.0
4.8
4.8
14.0
14.0
4.6
4.6
13.0
13.0
4.4
4.4
4.2
4.2
12.0
12.0
4.0
4.0
11.0
11.0
3.8
3.8
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
2000
2001
2002
2003
2004 2005
2006
2007
2008
2009
Source: ECB.
ECB
S Monthly Bulletin
62 July 2010

EURO AREA
STATISTICS
External
transactions
and
positions
7.2 Current and capital accounts
(EUR billions)
2. Income account
(transactions)

Compensation

of employees
Investment income

Credit
Debit
Total
Direct investment
Portfolio investment
Other investment

Credit
Debit
Equity
Debt
Equity
Debt
Credit
Debit

Credit
Debit
Credit
Debit
Credit
Debit
Credit
Debit
Reinv.
Reinv.
earnings
earnings
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
2007
18.8
10.3
579.9
585.5
208.7
70.9
137.7
44.2
26.6
25.2
45.3
113.7
118.8
111.1
180.5
197.8
2008
18.9
10.4
527.1
612.2
154.4
17.9
147.0
50.0
29.9
24.8
43.0
119.0
125.2
125.3
174.5
196.1
2009
18.9
11.6
402.0
447.4
131.7
23.2
106.5
37.1
20.3
20.8
31.4
80.0
110.2
141.9
108.5
98.3
2008 Q4
4.9
2.7
127.8
142.3
35.9
-1.5
36.5
10.1
8.4
6.0
8.4
19.9
31.6
32.7
43.5
47.1
2009 Q1
4.7
2.1
108.8
114.4
34.1
7.8
26.7
15.2
5.2
5.1
6.9
13.3
29.4
37.5
33.3
31.9
Q2
4.6
2.6
106.6
134.2
33.1
1.5
25.6
4.3
5.6
5.9
10.6
38.8
27.5
36.6
29.8
27.2
Q3
4.6
3.5
90.5
98.4
29.0
7.5
25.1
8.5
4.1
4.7
7.1
13.9
27.4
34.8
22.9
19.9
Q4
5.0
3.5
96.2
100.5
35.5
6.3
29.1
9.1
5.4
5.0
6.8
14.1
25.9
33.0
22.5
19.3
3. Geographical breakdown
(cumulated transactions)

Total
EU Member States outside the euro area
Brazil Canada
China
India
Japan
Russia Switzer-
United
Other
land
States
Total
Den- Sweden
United Other EU
EU
mark
Kingdom countries
insti-
2009 Q1 to
tutions
2009 Q4
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16

Credits
Current account
2,274.9
803.1
45.9
65.9
393.5
234.0
63.7
34.4
30.6
87.0
29.3
46.7
70.3
167.3
306.4
699.8
Goods
1,290.1
429.7
27.7
41.2
183.8
176.8
0.2
18.5
15.7
69.1
21.8
28.8
50.2
83.8
153.2
419.3
Services
471.1
157.2
11.1
12.1
101.9
26.6
5.5
7.4
6.5
13.0
5.9
10.6
12.8
48.4
70.4
138.9
Income
421.0
148.5
6.5
11.3
96.1
27.1
7.5
8.1
7.6
4.8
1.5
7.1
7.0
28.1
77.6
130.7

Investment income
402.0
141.8
6.4
11.1
94.5
26.5
3.3
8.1
7.5
4.7
1.5
7.1
6.9
20.9
75.7
127.8
Current transfers
92.8
67.8
0.7
1.3
11.8
3.4
50.6
0.4
0.8
0.2
0.1
0.2
0.3
6.9
5.1
10.9
Capital account
18.9
14.6
0.0
0.0
0.8
0.2
13.5
0.0
0.0
0.0
0.0
0.0
0.1
0.3
0.5
3.3

Debits
Current account
2,330.7
749.6
40.6
67.3
336.3
207.7
97.6
- 24.6
-
- 85.9
-
157.0
324.9
-
Goods
1,250.5
359.7
26.2
37.0
136.4
160.0
0.0
20.1
10.3
153.4
18.0
41.8
78.3
72.1
121.4
375.5
Services
439.7
133.8
7.1
10.4
84.4
31.6
0.2
5.7
5.6
9.7
4.4
7.6
7.5
40.3
94.3
130.7

Income
459.0
145.9
6.4
18.8
103.0
11.7
6.0
- 7.0
-
- 36.1
- 38.6
102.2
-

Investment income
447.4
138.5
6.3
18.7
101.4
6.0
6.0
-
6.9
-
-
36.0
-
38.1
101.4
-
Current transfers
181.5
110.1
0.8
1.1
12.5
4.4
91.4
1.4
1.7
2.9
0.7
0.4
0.5
5.9
6.9
50.9
Capital account
10.9
2.4
0.1
0.1
0.9
0.2
1.0
0.1
0.1
0.1
0.2
0.1
0.0
0.5
0.8
6.6

Net
Current account
-55.8
53.6
5.3
-1.4
57.2
26.2
-33.9
- 6.0
- -
-39.2
-
10.2
-18.5
-
Goods
39.5
70.0
1.5
4.2
47.4
16.8
0.2
-1.5
5.4
-84.3
3.8
-13.0
-28.2
11.7
31.8
43.8
Services
31.4
23.3
3.9
1.7
17.5
-5.0
5.2
1.7
0.9
3.2
1.6
3.0
5.3
8.1
-23.9
8.2

Income
-38.0
2.5
0.1
-7.5
-6.9
15.5
1.5
- 0.6
-
- -29.0
- -10.5
-24.6
-

Investment income
-45.4
3.3
0.1
-7.6
-7.0
20.5
-2.7
-
0.6
-
-
-29.0
-
-17.2
-25.7
-
Current transfers
-88.7
-42.4
-0.2
0.2
-0.7
-1.0
-40.8
-1.1
-0.9
-2.6
-0.6
-0.1
-0.2
0.9
-1.8
-40.0
Capital account
8.0
12.3
0.0
-0.1
-0.1
0.0
12.5
-0.1
-0.1
-0.1
-0.2
-0.1
0.0
-0.1
-0.3
-3.3
Source: ECB.
ECB
Monthly Bulletin
July 2010 S 63

7.3 Financial account
(EUR billions and annual growth rates; outstanding amounts and growth rates at end of period; transactions and other changes during period)
1. Summary financial account

Total 1)
Total
Direct
Portfolio
Net
Other
Reserve

as a % of GDP
investment
investment
financial
investment
assets
derivatives
Assets Liabilities
Net
Assets Liabilities
Net
Assets Liabilities
Assets Liabilities
Assets Liabilities
1
2
3
4
5
6
7
8
9
10
11
12
13
14
Outstanding amounts (international investment position)
2006
12,384.3
13,399.8
-1,015.5
144.7
156.6
-11.9
3,153.4
2,729.4
4,372.1
5,950.0
-20.8
4,553.8
4,720.4
325.8
2007
13,908.5
15,155.8
-1,247.3
154.4
168.2
-13.8
3,572.8
3,130.7
4,631.6
6,556.5
-26.0
5,382.9
5,468.6
347.2

2008
13,315.2
14,949.2
-1,634.0
143.7
161.4
-17.6
3,744.4
3,217.0
3,763.9
6,078.6
-36.2
5,468.8
5,653.6
374.2
2009 Q2
13,309.9
14,845.3
-1,535.4
146.6
163.5
-16.9
4,012.1
3,302.8
3,898.5
6,304.5
-57.8
5,075.6
5,238.0
381.5
Q3
13,381.5
14,979.0
-1,597.5
148.6
166.3
-17.7
4,042.1
3,345.1
4,059.8
6,626.7
-60.1
4,908.9
5,007.2
430.8

Q4
13,687.5
15,154.8
-1,467.3
152.6
168.9
-16.4
4,138.5
3,386.5
4,209.0
6,816.7
-48.3
4,926.0
4,951.6
462.4
Changes to outstanding amounts
2005
2,209.7
2,070.3
139.3
27.1
25.4
1.7
522.1
209.0
842.5
1,012.3
16.0
790.0
849.1
39.1
2006
1,545.8
1,845.7
-299.9
18.1
21.6
-3.5
362.6
285.1
484.6
892.2
0.6
692.3
668.4
5.7
2007
1,524.2
1,756.0
-231.9
16.9
19.5
-2.6
419.4
401.3
259.5
606.5
-5.2
829.1
748.1
21.4

2008
-593.3
-206.6
-386.6
-6.4
-2.2
-4.2
171.7
86.3
-867.7
-478.0
-10.2
85.9
185.1
27.0
2009 Q3
71.6
133.7
-62.1
3.2
6.0
-2.8
30.0
42.3
161.2
322.2
-2.3
-166.7
-230.8
49.3

Q4
306.0
175.8
130.2
13.1
7.6
5.6
96.4
41.4
149.2
190.0
11.8
17.1
-55.6
31.5
Transactions
2006
1,728.6
1,719.1
9.4
20.2
20.1
0.1
417.6
257.4
519.8
708.5
0.6
789.3
753.2
1.3
2007
1,946.6
1,935.9
10.7
21.6
21.5
0.1
476.5
402.9
438.5
589.9
63.7
962.8
943.1
5.1
2008
464.8
628.0
-163.2
5.0
6.8
-1.8
323.8
125.1
-10.2
333.9
62.5
85.3
169.0
3.4

2009
-164.6
-119.3
-45.4
-1.8
-1.3
-0.5
314.4
218.6
74.2
392.1
-39.9
-508.8
-729.9
-4.5
2009 Q3
20.8
8.1
12.6
0.9
0.4
0.6
62.0
38.2
45.6
123.7
4.5
-91.0
-153.8
-0.3

Q4
55.9
52.2
3.8
2.4
2.2
0.2
62.8
55.0
38.0
101.1
-5.8
-39.1
-103.9
0.1
2010 Q1
157.3
175.3
-18.1
7.1
7.9
-0.8
46.5
19.8
69.9
60.3
-3.9
40.1
95.2
4.8
2009 Dec.
-77.5
-85.6
8.1
.
.
.
15.3
17.9
-6.4
54.7
-4.1
-83.1
-158.2
0.8
2010 Jan.
79.6
94.0
-14.5
.
.
.
5.8
2.6
30.9
30.2
-5.1
49.5
61.2
-1.5
Feb.
42.6
47.2
-4.5
.
.
.
14.4
15.0
9.0
16.5
0.1
15.5
15.7
3.6
Mar.
35.1
34.1
1.0
.
.
.
26.4
2.2
30.0
13.6
1.1
-25.0
18.2
2.6

Apr.
127.6
135.7
-8.2
.
.
.
15.6
4.3
16.7
46.6
0.3
94.9
84.8
0.0
Other changes
2005
851.4
749.6
101.7
10.4
9.2
1.2
163.7
56.5
426.3
487.7
-1.4
205.7
205.4
57.1
2006
-182.7
126.6
-309.3
-2.1
1.5
-3.6
-55.0
27.7
-35.2
183.7
0.0
-97.0
-84.8
4.4
2007
-422.5
-179.9
-242.5
-4.7
-2.0
-2.7
-57.1
-1.5
-179.0
16.6
-69.0
-133.6
-195.0
16.3

2008
-1,058.0
-834.6
-223.4
-11.4
-9.0
-2.4
-152.1
-38.8
-857.5
-811.8
-72.7
0.6
16.1
23.6

Other changes due to exchange rate changes
2005
394.2
245.0
149.2
4.8
3.0
1.8
89.8
5.7
158.3
101.4
. 129.2
137.9
17.0
2006
-343.3
-228.5
-114.8
-4.0
-2.7
-1.3
-72.1
-4.2
-151.6
-101.1
. -105.7
-123.2
-13.9

2007
-531.1
-291.5
-239.6
-5.9
-3.2
-2.7
-113.3
-5.9
-219.2
-106.0
. -185.0
-179.6
-13.7
2008
-40.3
59.3
-99.6
-0.4
0.6
-1.1
-17.3
-0.2
1.8
42.0
. -34.0
17.5
9.2

Other changes due to price changes
2005
284.5
430.3
-145.8
3.5
5.3
-1.8
45.0
40.8
199.0
389.5
-1.4
. .
41.9
2006
288.6
298.4
-9.8
3.4
3.5
-0.1
45.4
33.5
226.0
264.9
0.0
. .
17.1

2007
82.4
124.7
-42.4
0.9
1.4
-0.5
46.5
12.5
75.0
112.2
-69.8
. .
30.7
2008
-1,013.8
-1,102.1
88.3
-10.9
-11.9
1.0
-155.6
-138.4
-803.6
-963.7
-75.9
. .
21.2

Other changes due to other adjustments
2005
172.7
74.3
98.3
2.1
0.9
1.2
29.0
10.0
69.0
-3.1
. 76.5
67.4
-1.8
2006
-128.1
56.7
-184.7
-1.5
0.7
-2.2
-28.3
-1.6
-109.6
19.8
. 8.7
38.4
1.2
2007
30.7
-16.9
47.6
0.3
-0.2
0.5
5.0
-13.6
-33.0
12.4
. 59.5
-15.7
-0.8

2008
-20.9
191.6
-212.5
-0.2
2.1
-2.3
18.0
87.4
-56.9
102.2
. 25.4
2.0
-7.3
Growth rates of outstanding amounts
2005
15.2
13.4
- . . .
15.2
6.8
13.1
12.1
.
18.5
19.5
-5.9
2006
16.1
14.8
- . . .
15.0
10.5
13.6
13.7
.
20.5
18.7
0.3
2007
15.7
14.3
- . . .
15.1
14.7
10.0
9.8
.
21.2
20.0
1.6

2008
3.3
4.2
- . . .
9.2
4.0
-0.5
5.3
.
1.6
3.2
1.0
2009 Q3
-4.0
-3.0
- . . .
7.9
4.9
-3.0
4.4
.
-12.2
-14.9
-1.1

Q4
-1.2
-0.8
- . . .
8.3
6.8
1.9
6.4
.
-9.3
-12.8
-1.2
2010 Q1
2.0
1.3
. . . .
6.6
6.2
5.6
6.0
.
-3.7
-7.1
1.3
Source: ECB.
1)
Net financial derivatives are included in assets.
ECB
S Monthly Bulletin
64 July 2010

EURO AREA
STATISTICS
External
transactions
and
positions
7.3 Financial account
(EUR billions and annual growth rates; outstanding amounts and growth rates at end of period, transactions during period)
2. Direct investment

By resident units abroad
By non-resident units in the euro area

Total
Equity capital
Other capital
Total
Equity capital
Other capital
and reinvested earnings
(mostly inter-company loans)
and reinvested earnings
(mostly inter-company loans)
Total
MFIs
Non-
Total
MFIs
Non-
Total Into MFIs
Into
Total
To MFIs
To
MFIs
MFIs
non-MFIs
non-MFIs
1
2
3
4
5
6
7
8
9
10
11
12
13
14
Oustanding amounts (international investment position)
2007
3,572.8
2,886.7
240.8
2,645.9
686.1
6.4
679.7
3,130.7
2,401.0
69.5
2,331.5
729.8
15.4
714.4

2008
3,744.4
2,946.9
234.8
2,712.1
797.5
9.3
788.2
3,217.0
2,405.5
77.0
2,328.5
811.6
16.4
795.1

2009 Q3
4,042.1
3,158.3
259.6
2,898.7
883.8
10.4
873.4
3,345.1
2,517.5
74.7
2,442.8
827.6
15.2
812.4
Q4
4,138.5
3,246.9
259.8
2,987.1
891.6
11.0
880.6
3,386.5
2,566.9
76.7
2,490.2
819.6
15.2
804.4
Transactions
2008
323.8
195.1
-4.8
199.9
128.7
-0.2
128.9
125.1
93.0
-1.3
94.3
32.1
1.6
30.4
2009
314.4
227.0
22.0
205.0
87.4
3.4
84.0
218.6
212.3
8.1
204.2
6.3
-0.6
6.9
2009 Q3
62.0
37.0
-1.6
38.7
24.9
0.3
24.6
38.2
35.4
2.4
33.0
2.8
-1.1
3.9
Q4
62.8
64.4
-1.2
65.6
-1.6
1.7
-3.3
55.0
60.9
3.0
57.9
-5.9
0.1
-5.9

2010 Q1
46.5
23.9
5.2
18.6
22.6
0.2
22.4
19.8
14.7
0.2
14.5
5.1
0.5
4.7
2009 Dec.
15.3
15.6
-1.5
17.1
-0.3
1.2
-1.5
17.9
25.4
4.9
20.5
-7.4
0.3
-7.8
2010 Jan.
5.8
7.0
0.2
6.8
-1.3
0.0
-1.3
2.6
4.6
0.4
4.2
-2.0
-2.2
0.3
Feb.
14.4
7.4
3.9
3.4
7.0
0.2
6.8
15.0
6.1
0.1
6.0
8.9
4.7
4.1
Mar.
26.4
9.5
1.1
8.4
16.9
0.0
16.9
2.2
4.0
-0.2
4.2
-1.8
-2.0
0.3

Apr.
15.6
1.7
0.8
0.9
14.0
0.3
13.7
4.3
5.4
0.4
5.0
-1.1
1.5
-2.7
Growth rates
2007
15.1
14.4
8.3
15.0
18.5
-55.0
18.7
14.7
14.6
8.8
14.7
15.3
6.3
15.4

2008
9.2
6.8
-2.0
7.6
18.9
-2.0
19.1
4.0
3.9
-1.8
4.1
4.5
9.9
4.4
2009 Q3
7.9
6.3
8.5
6.1
14.2
13.8
14.2
4.9
7.2
7.1
7.2
-1.9
-5.0
-1.8
Q4
8.3
7.6
9.4
7.5
10.9
37.0
10.6
6.8
8.9
11.3
8.8
0.8
-3.7
0.9

2010 Q1
6.6
6.5
3.7
6.7
7.3
28.0
7.0
6.2
7.7
10.0
7.6
1.9
-1.9
2.0
C34 Euro area international investment position
C35 Euro area direct and portfolio investment position
(outstanding amounts at end of period; as a percentage of GDP)
(outstanding amounts at end of period; as a percentage of GDP)
net direct investment
net international investment position
net portfolio investment
-4.0
-4.0
10.0
10.0
-6.0
-6.0
5.0
5.0
-8.0
-8.0
0.0
0.0
-10.0
-10.0
-5.0
-5.0
-12.0
-12.0
-10.0
-10.0
-14.0
-14.0
-15.0
-15.0
-16.0
-16.0
-20.0
-20.0
-18.0
-18.0
-25.0
-25.0
-20.0
-20.0
-30.0
-30.0
2001
2002
2003
2004
2005
2006
2007
2008
2009
2001
2002
2003
2004
2005
2006
2007
2008
2009
Source: ECB.
ECB
Monthly Bulletin
July 2010 S 65

7.3 Financial account
(EUR billions and annual growth rates; outstanding amounts and growth rates at end of period; transactions during period)
3. Portfolio investment assets

Total
Equity
Debt instruments

Bonds and notes
Money market instruments

Total
MFIs
Non-MFIs
Total
MFIs
Non-MFIs
Total
MFIs
Non-MFIs
Euro-
General
Euro-
General
Euro-
General
system
government
system
government
system
government
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
Outstanding amounts (international investment position)
2007
4,631.6 1,961.8
136.7
2.8
1,825.1
44.6 2,279.7
990.2
16.4
1,289.5
17.2
390.1
297.3
34.6
92.8
0.5

2008
3,763.9 1,162.7
68.4
3.0
1,094.3
27.3 2,179.1
970.9
19.9
1,208.2
18.4
422.1
353.3
61.6
68.8
1.3
2009 Q3
4,059.8 1,368.1
75.3
3.1
1,292.8
32.0 2,277.7
926.8
16.8
1,351.0
37.9
413.9
341.9
45.0
72.1
1.5

Q4
4,209.0 1,482.0
78.2
3.1
1,403.9
34.4 2,344.9
924.3
17.2
1,420.6
37.0
382.0
324.4
44.9
57.7
2.0
Transactions
2007
438.5
64.7
26.7
0.0
38.0
8.2
290.5
148.0
4.9
142.4
3.3
83.3
63.3
26.3
20.0
0.8
2008
-10.2
-103.9
-38.4
0.6
-65.6
-0.2
96.7
44.1
3.2
52.6
2.6
-3.0
26.8
15.1
-29.8
0.4
2009
74.2
46.6
-2.9
-0.2
49.5
1.6
29.3 -103.3
-3.5
132.6
17.2
-1.8
5.4
-12.7
-7.2
1.0
2009 Q3
45.6
39.6
3.7
0.0
35.9
0.2
27.4
-7.0
-0.8
34.4
-1.4
-21.4
-10.1
-11.8
-11.2
-0.1
Q4
38.0
35.8
-0.6
-0.2
36.3
0.4
25.1
-14.0
-0.5
39.1
-1.5
-22.9
-17.9
1.3
-5.0
0.8

2010 Q1
69.9
20.3
7.0
0.0
13.3
. 47.6
2.1
-0.2
45.5
. 2.1
-7.8
-1.4
9.8
.
2009 Dec.
-6.4
8.9
1.0
0.1
7.9
. 0.6
-5.6
0.3
6.2
.
-15.9
-11.4
-5.7
-4.4
.
2010 Jan.
30.9
-2.9
-0.5
0.0
-2.4
. 14.5
0.4
0.3
14.1
. 19.3
9.8
4.8
9.5
.
Feb.
9.0
3.8
1.3
0.0
2.5
. 5.5
-0.4
0.0
5.9
. -0.3
-1.6
-0.3
1.3
.
Mar.
30.0
19.4
6.2
0.0
13.2
. 27.6
2.1
-0.6
25.5
. -16.9
-15.9
-5.9
-1.0
.

Apr.
16.7
5.7
2.7
-0.2
2.9
. 14.3
5.1
0.6
9.2
. -3.2
-7.5
0.7
4.3
.
Growth rates
2007
10.0
3.3
22.3
-0.5
2.0
21.3
13.9
16.6
38.9
11.9
23.2
23.9
23.7
272.7
29.4
277.4

2008
-0.5
-6.2
-30.0
24.6
-4.5
-0.5
4.3
4.6
20.4
4.1
15.6
-0.6
9.1
41.9
-32.3
71.6
2009 Q3
-3.0
-3.0
-8.6
12.4
-2.6
0.5
-2.5
-10.6
-20.1
4.0
96.8
-6.7
-0.2
-30.8
-31.4
69.4
Q4
1.9
3.4
-4.5
-7.2
3.9
5.8
1.2
-10.4
-17.7
10.8
93.2
-1.1
0.9
-22.0
-9.8
73.2

2010 Q1
5.6
8.4
13.6
-6.9
8.1
. 6.0
-5.5
-7.7
15.0
. -5.7
-7.1
-23.9
3.0
.
4. Portfolio investment liabilities

Total
Equity
Debt instruments

Bonds and notes
Money market instruments

Total
MFIs
Non-MFIs
Total
MFIs
Non-MFIs
Total
MFIs
Non-MFIs
General
General
government
government
1
2
3
4
5
6
7
8
9
10
11
12
Outstanding amounts (international investment position)
2007
6,556.5
3,272.5
594.6
2,677.9
3,041.1
1,143.5
1,897.6
1,118.5
243.0
141.5
101.5
76.1

2008
6,078.6
2,168.7
640.7
1,528.0
3,466.5
1,263.8
2,202.8
1,357.1
443.3
108.9
334.4
272.9
2009 Q3
6,626.7
2,577.5
717.6
1,859.9
3,502.3
1,170.8
2,331.5
1,454.7
546.8
70.4
476.4
420.2

Q4
6,816.7
2,719.4
710.9
2,008.5
3,527.3
1,186.7
2,340.6
1,444.7
570.1
99.4
470.7
414.2
Transactions
2008
333.9
-107.1
94.8
-201.9
236.3
26.3
210.0
196.7
204.7
-20.1
224.8
194.6
2009
392.1
139.8
6.4
133.4
134.2
-12.4
146.5
137.0
118.1
-2.5
120.6
148.0
2009 Q3
123.7
89.5
11.7
77.7
-19.2
-9.1
-10.1
-8.7
53.5
10.0
43.5
59.2
Q4
101.1
50.4
-7.1
57.5
42.4
9.3
33.2
20.4
8.3
14.5
-6.2
-4.0

2010 Q1
60.3
40.7
13.4
27.3
25.7
18.3
7.4
. -6.1
5.8
-11.9
.
2009 Dec.
54.7
57.2
-0.7
57.8
6.8
2.7
4.1
. -9.3
21.9
-31.2
.
2010 Jan.
30.2
18.3
-0.3
18.6
2.1
25.6
-23.6
. 9.8
-4.3
14.1
.
Feb.
16.5
8.8
0.1
8.7
4.6
-13.1
17.7
. 3.1
7.5
-4.4
.
Mar.
13.6
13.7
13.7
0.0
19.1
5.8
13.3
. -19.1
2.6
-21.6
.

Apr.
46.6
-2.5
-2.2
-0.3
46.3
16.5
29.7
. 2.8
5.2
-2.4
.
Growth rates
2007
9.8
5.5
4.4
5.8
13.3
15.5
12.1
13.9
29.6
55.3
10.1
32.0

2008
5.3
-4.7
16.2
-9.8
7.8
2.3
11.1
17.6
81.5
-13.3
215.6
271.7
2009 Q3
4.4
-0.1
4.6
-1.3
1.7
-5.6
6.0
11.6
59.5
-23.2
111.6
168.4

Q4
6.4
6.0
1.0
8.2
3.9
-1.0
6.6
10.1
26.6
3.2
35.7
54.9
2010 Q1
6.0
8.0
2.9
10.0
2.5
1.5
3.0
. 22.5
36.0
20.9
.
Source: ECB.
ECB
S Monthly Bulletin
66 July 2010

EURO AREA
STATISTICS
External
transactions
and
positions
7.3 Financial account
(EUR billions and annual growth rates; outstanding amounts and growth rates at end of period; transactions during period)
5. Other investment assets

Total
Eurosystem
MFIs
General
Other sectors

(excluding Eurosystem)
government

Total
Loans/
Other
Total
Loans/
Other
Trade Loans/currency
Trade Loans/currency
currency
assets
currency
assets
credits
and deposits
credits and deposits
and
and
deposits
deposits
Currency
Currency
and
and
deposits
deposits
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
Outstanding amounts (international investment position)
2007
5,382.9
36.9
35.6
1.4
3,354.4
3,283.2
71.2
107.8
12.7
48.8
13.7
1,883.7
196.2 1,520.0
473.1

2008
5,468.8
28.8
27.7
1.0
3,280.7
3,221.6
59.1
101.0
12.1
40.9
7.2
2,058.3
186.1 1,647.7
461.7
2009 Q3
4,908.9
22.8
22.5
0.3
2,823.8
2,790.5
33.3
114.8
11.8
54.0
8.9
1,947.5
191.7 1,524.6
407.1

Q4
4,926.0
29.7
29.4
0.3
2,842.1
2,811.5
30.6
122.0
11.8
60.5
10.0
1,932.2
190.1 1,492.2
381.2
Transactions
2007
962.8
22.0
22.0
0.0
546.7
539.5
7.2
-7.8
-1.4
-7.4
-5.5
401.9
14.1
344.9
54.9
2008
85.3
-9.4
-9.4
0.0
-48.4
-64.8
16.5
-7.0
-1.1
-7.2
-6.0
150.0
2.8
88.3
-41.1
2009
-508.8
-2.4
-2.4
0.0
-414.5
-394.0
-20.5
9.5
-0.3
7.9
1.1
-101.5
1.9
-105.7
-42.8
2009 Q3
-91.0
-6.7
-6.7
0.0
-83.6
-81.3
-2.3
0.0
-0.3
0.1
-4.0
-0.6
0.4
2.1
14.7
Q4
-39.1
5.5
5.5
0.0
-4.4
-2.3
-2.1
6.6
0.0
6.2
1.1
-46.8
-0.6
-47.5
-41.7

2010 Q1
40.1
-7.1
.
. 49.0
.
. -7.4
.
. -3.7
5.5
. . -0.2
2009 Dec.
-83.1
4.1
.
. -35.6
.
. 3.4
.
.
0.1
-54.9
.
. -21.6
2010 Jan.
49.5
-5.1
.
. 67.7
.
. -4.1
.
. -2.9
-9.0
. . -5.5
Feb.
15.5
-1.7
.
. 6.4
.
. -1.1
. . 0.8
12.0
. . 8.8
Mar.
-25.0
-0.3
.
. -25.0
.
. -2.2
.
. -1.6
2.5
. . -3.5

Apr.
94.9
1.2
.
. 70.5
.
. 4.9
. . 4.9
18.3
. . 3.7
Growth rates
2007
21.2
157.3
173.7
-1.7
18.6
18.8
11.3
-6.5
-9.8
-12.6
-28.6
27.2
7.5
29.6
13.9

2008
1.6
-26.2
-26.9
5.0
-1.4
-2.0
23.4
-6.5
-8.9
-14.7
-43.8
8.0
1.4
5.9
-8.9
2009 Q3
-12.2
-42.5
-43.9
4.1
-18.3
-18.4
-23.1
3.5
-4.7
7.8
-13.4
-1.6
-3.8
-1.6
0.6
Q4
-9.3
-10.6
-11.7
0.2
-12.6
-12.2
-36.8
8.9
-2.4
16.2
16.1
-5.0
1.0
-6.6
-10.3

2010 Q1
-3.7
-4.9
.
. -4.2
.
. -3.9
.
. -67.5
-3.0
. . -3.0
6. Other investment liabilities

Total
Eurosystem
MFIs
General
Other sectors

(excluding Eurosystem)
government

Total
Loans/
Other
Total
Loans/
Other
Total
Trade
Loans
Other
Total
Trade
Loans
Other
currency
liabilities
currency
liabilities
credits
liabilities
credits
liabilities
and
and
deposits
deposits
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
Outstanding amounts (international investment position)
2007
5,468.6
201.7
201.4
0.2
3,935.1
3,872.6
62.5
52.3
0.0
46.9
5.4
1,279.5
156.9
1,009.7
112.8

2008
5,653.6
482.3
481.9
0.4
3,751.8
3,698.1
53.6
61.9
0.0
58.0
3.9
1,357.6
170.2
1,069.6
117.8
2009 Q3
5,007.2
264.3
263.8
0.6
3,450.3
3,413.6
36.8
59.5
0.0
56.2
3.3
1,233.1
179.4
943.5
110.2

Q4
4,951.6
249.6
249.3
0.3
3,394.6
3,356.3
38.3
57.2
0.0
53.6
3.6
1,250.3
181.1
952.3
116.8
Transactions
2007
943.1
89.6
89.6
0.0
625.1
620.4
4.6
-1.0
0.0
-2.0
1.0
229.5
10.0
220.5
-1.1
2008
169.0
280.7
280.6
0.1
-178.9
-190.0
11.1
9.4
0.0
10.8
-1.4
57.8
10.9
47.3
-0.4
2009
-729.9
-231.7
-236.5
4.7
-354.3
-343.0
-11.3
-6.9
0.0
-6.7
-0.2
-137.1
0.9
-113.4
-24.5
2009 Q3
-153.8
-43.5
-43.7
0.3
-79.5
-80.1
0.6
0.7
0.0
1.2
-0.5
-31.5
1.0
-20.8
-11.7
Q4
-103.9
-16.8
-16.5
-0.2
-81.1
-81.9
0.8
-3.9
0.0
-4.4
0.6
-2.1
1.0
4.3
-7.4

2010 Q1
95.2
-5.9
. .
98.4
. .
4.6
. . .
-1.8
. . .
2009 Dec.
-158.2
-7.2
. .
-104.5
. .
-10.8
. . .
-35.7
. . .
2010 Jan.
61.2
-7.5
. .
70.5
. .
-0.1
. . .
-1.7
. . .
Feb.
15.7
3.2
. .
32.6
. .
4.7
. . .
-24.8
. . .
Mar.
18.2
-1.7
. .
-4.7
. .
0.0
. . .
24.7
. . .

Apr.
84.8
2.2
. .
90.1
. .
1.0
. . .
-8.4
. . .
Growth rates
2007
20.0
68.1
68.2
-6.9
18.0
18.2
9.2
-1.8
27.4
-4.0
20.7
20.9
6.8
26.4
0.5

2008
3.2
141.3
141.4
20.8
-4.5
-4.9
17.8
18.1
-20.1
23.0
-25.1
4.5
6.8
4.6
-0.9
2009 Q3
-14.9
-27.7
-29.0
935.0
-16.3
-16.4
-13.9
11.8
234.7
13.2
-9.0
-8.0
-3.1
-8.8
-8.7

Q4
-12.8
-47.9
-48.8
644.2
-9.4
-9.2
-20.3
-11.0
-148.2
-11.4
-6.3
-9.9
0.2
-10.5
-19.7
2010 Q1
-7.1
-38.7
. .
-3.9
. .
-1.9
. . .
-6.8
. . .
Source: ECB.
ECB
Monthly Bulletin
July 2010 S 67

7.3 Financial account
(EUR billions and annual growth rates; outstanding amounts and growth rates at end of period; transactions during period)
7. Reserve assets

Reserve assets
Memo

items

Total Monetary gold
SDR Reserve
Foreign exchange
Other
Other
Pre-
SDR
holdings position

claims
foreign determined
allo-
In
In fine
in the
Total
Currency and
Securities
Financial
currency
short-term cations
EUR
troy
IMF
deposits

derivatives
assets
net
billions
ounces
drains
(millions)
With
With
Total
Equity Bonds
Money
on
monetary banks
and
market
foreign
authorities
notes instruments
currency
and the BIS
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
Outstanding amounts (international investment position)
2006
325.8
176.3
365.213
4.6
5.2 139.7
6.3
22.5
110.7
0.5
79.3
30.8
0.3
0.0
24.6
-21.5
5.6
2007
347.2
201.0
353.688
4.6
3.6 138.0
7.2
22.0
108.5
0.4
87.8
20.3
0.3
0.0
44.3
-38.5
5.3

2008
374.2
217.0
349.207
4.7
7.3 145.1
7.6
8.0
129.5
0.6 111.3
17.6
0.0
0.1
262.8
-245.7
5.5
2009 Q2
381.5
229.8
347.563
4.2
11.3 136.2
9.5
6.6
119.9
0.5
99.3
20.0
0.2
0.0
67.6
-65.6
5.4
Q3
430.8
236.1
347.217
49.8
11.7 133.2
12.7
7.1
113.2
0.5
89.8
22.9
0.2
0.0
56.7
-42.4
50.9

Q4
462.4
266.0
347.180
50.8
10.0 135.5
12.3
8.1
115.2
0.5
92.0
22.7
-0.1
0.0
32.1
-24.2
51.2

2010 Apr.
521.6
307.5
347.173
53.0
12.5 148.6
9.6
12.0
127.3
- -
- -0.3
0.0
28.0
-22.1
53.4
May
569.7
340.6
347.163
55.6
16.0 157.6
5.2
16.5
136.4
- -
- -0.5
0.0
36.3
-28.2
55.9
Transactions
2007
5.1
-3.2
- 0.3
-0.9
8.8
1.0
1.6
6.2
0.0
14.5
-8.3
0.0
0.0
-
- -
2008
3.4
-2.7
- -0.1
3.8
2.4
5.0
-15.7
11.8
0.1
15.8
-4.1
1.3
0.0
-
- -

2009
-4.5
-2.0
- 0.8
2.7
-5.9
3.7
-1.2
-9.5
0.0
-14.1
4.6
1.2
0.0
-
- -
2009 Q3
-0.3
-0.2
- 0.3
0.6
-1.0
2.3
0.3
-3.8
0.0
-7.0
3.2
0.2
0.0
-
- -

Q4
0.1
0.0
- 1.0
-2.0
1.2
-0.5
0.5
1.1
0.0
1.5
-0.4
0.1
0.0
-
- -
2010 Q1
4.8
-
- - -
-
-
- - -
-
- -
- -
- -
Growth rates
2006
0.3
-2.4
- 11.6
-49.0
7.7
-48.4
12.7
13.4
0.0
29.2
-15.3
- -
-
- -
2007
1.6
-1.7
- 7.3
-18.3
6.3
14.9
6.4
5.7
1.1
18.6
-27.6
- - -
- -

2008
1.0
-1.3
- -2.6
105.3
1.7
67.7
-68.9
10.8
28.0
17.9
-20.6
- - -
- -
2009 Q3
-1.1
-1.3
- -2.9
200.8
-6.2
60.3
-70.1
-2.7
1.3
-8.9
34.6
- - -
- -
Q4
-1.2
-0.9
- -2.0
35.2
-4.0
47.5
-22.6
-7.3
1.0
-12.8
25.6
- - -
- -

2010 Q1
1.3
-
- - -
-
-
- - -
-
- -
- -
- -
8. Gross external debt

Total
By instrument
By sector (excluding direct investment)

Loans,
Money
Bonds
Trade
Other debt
Direct investment:
General
Eurosystem
MFIs
Other
currency
market
and notes
credits
liabilities
inter-company government
(excluding
sectors
and
instruments
lending
Eurosystem)
deposits
1
2
3
4
5
6
7
8
9
10
11
Outstanding amounts (international investment position)
2006
8,683.9
4,425.5
217.5
2,697.9
144.1
150.8
1,048.0
1,115.2
116.3
4,586.8
1,817.5
2007
9,972.8
5,130.6
243.0
3,041.1
157.0
181.0
1,220.2
1,246.8
201.7
5,220.1
2,084.0

2008
10,941.3
5,307.6
443.3
3,466.5
170.2
175.8
1,377.8
1,692.0
482.3
5,124.4
2,264.7
2009 Q2
10,625.9
4,890.6
493.7
3,503.7
183.1
164.4
1,390.4
1,856.1
313.4
4,853.8
2,212.2
Q3
10,461.0
4,677.0
546.8
3,502.3
179.4
150.8
1,404.6
1,934.4
264.3
4,691.5
2,166.1

Q4
10,457.9
4,611.5
570.1
3,527.3
181.1
159.0
1,408.9
1,916.1
249.6
4,680.6
2,202.6
Outstanding amounts as a percentage of GDP
2006
101.4
51.7
2.5
31.5
1.7
1.8
12.2
13.0
1.4
53.6
21.2
2007
110.6
56.9
2.7
33.7
1.7
2.0
13.5
13.8
2.2
57.9
23.1

2008
118.2
57.3
4.8
37.4
1.8
1.9
14.9
18.3
5.2
55.4
24.5
2009 Q2
116.9
53.8
5.4
38.6
2.0
1.8
15.3
20.4
3.4
53.4
24.3
Q3
116.1
51.9
6.1
38.9
2.0
1.7
15.6
21.5
2.9
52.1
24.0

Q4
116.6
51.4
6.4
39.3
2.0
1.8
15.7
21.4
2.8
52.2
24.6
Source: ECB.
ECB
S Monthly Bulletin
68 July 2010

EURO AREA
STATISTICS
External
transactions
and
positions
7.3 Financial account
(EUR billions; outstanding amounts at end of period; transactions during period)
9. Geographical breakdown

Total
EU Member States outside the euro area
Canada China Japan Switzer- United Offshore
Interna-
Other
land
States financial
tional countries
Total Denmark Sweden
United Other EU
EU
centres organisa-
Kingdom countries institutions
tions
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15

2008

Outstanding amounts (international investment position)

Direct investment
527.4
-93.0
-2.1
-30.2
-293.9
233.6
-0.3
41.1
35.2
-9.5
126.2
-68.7
-7.1
-0.2
503.3
Abroad
3,744.4 1,255.3
34.9
93.9
865.7
260.8
0.0
104.1
38.8
71.7
384.5
734.6
418.5
0.1
736.8

Equity/reinvested earnings 2,946.9
967.5
30.1
60.3
660.1
216.9
0.0
83.3
32.0
53.6
335.3
551.3
386.7
0.0
537.4

Other capital
797.5
287.9
4.8
33.6
205.7
43.8
0.0
20.7
6.9
18.1
49.2
183.4
31.9
0.0
199.4
In the euro area
3,217.0 1,348.3
37.0
124.1
1,159.7
27.1
0.3
63.0
3.6
81.2
258.3
803.3
425.6
0.3
233.4

Equity/reinvested earnings 2,405.5 1,096.8
28.3
97.4
956.9
13.9
0.2
50.6
0.8
68.7
191.1
590.8
284.1
0.1
122.5

Other capital
811.6
251.5
8.7
26.7
202.8
13.2
0.1
12.4
2.9
12.5
67.2
212.5
141.6
0.2
110.9
Portfolio investment assets
3,763.9 1,242.2
63.7
122.4
895.5
80.7
80.0
82.8
25.6
213.4
95.4 1,225.8
458.4
30.5
389.8
Equity
1,162.7
228.7
6.4
19.9
191.7
9.8
0.9
18.2
22.8
84.5
81.3
378.8
197.8
2.0
148.6
Debt instruments
2,601.3 1,013.6
57.3
102.5
703.7
71.0
79.1
64.6
2.9
128.8
14.1
847.0
260.6
28.5
241.3

Bonds and notes
2,179.1
849.1
50.3
81.5
569.1
70.3
77.8
61.6
2.3
61.7
12.6
705.4
238.2
28.4
219.9

Money market instruments
422.1
164.5
6.9
21.0
134.6
0.6
1.3
3.0
0.6
67.1
1.5
141.5
22.4
0.1
21.4
Other investment
-184.8
-91.1
51.1
28.0
-110.4
108.8
-168.6
-6.2
-16.0
-10.2
-131.2
-286.3
-0.4
1.8
354.8
Assets
5,468.8 2,419.7
100.9
83.3
2,020.2
201.8
13.4
25.7
34.0
109.4
276.5
852.5
638.2
58.7
1,054.0

General government
101.0
15.0
0.7
0.4
3.6
0.7
9.7
0.0
1.8
0.2
0.1
3.4
1.4
40.1
39.1

MFIs
3,309.5 1,731.1
83.9
58.3
1,419.1
167.9
1.9
16.8
14.5
79.0
164.5
418.9
367.7
18.2
498.8

Other sectors
2,058.3
673.5
16.4
24.6
597.5
33.3
1.8
8.9
17.7
30.3
111.9
430.2
269.2
0.5
516.2
Liabilities
5,653.6 2,510.8
49.8
55.3
2,130.6
93.0
182.0
32.0
50.0
119.5
407.7 1,138.8
638.6
57.0
699.2

General government
61.9
32.5
0.0
0.1
2.5
0.0
29.7
0.0
0.0
0.6
0.5
7.0
0.3
17.7
3.3

MFIs
4,234.1 1,907.6
38.9
33.5
1,664.9
70.0
100.2
24.4
32.1
91.2
328.7
751.1
535.1
36.8
527.2

Other sectors
1,357.6
570.8
10.8
21.7
463.2
23.0
52.0
7.5
17.9
27.8
78.6
380.8
103.2
2.5
168.7

2009 Q1 to 2009 Q4

Cumulated transactions

Direct investment
95.7
46.9
0.6
-2.2
37.0
11.5
0.0
-6.0
4.7
-1.9
3.9
-0.8
37.6
-0.2
11.6
Abroad
314.4
90.7
2.2
10.8
70.4
7.2
0.0
5.5
4.9
-0.4
33.0
66.9
66.9
0.0
46.9

Equity/reinvested earnings
227.0
62.7
1.1
8.9
45.4
7.2
0.0
4.8
3.1
0.6
17.4
56.4
51.6
0.0
30.4

Other capital
87.4
28.0
1.1
1.9
25.0
0.0
0.0
0.6
1.8
-1.0
15.5
10.6
15.3
0.0
16.6
In the euro area
218.6
43.8
1.7
13.0
33.4
-4.3
0.0
11.4
0.2
1.6
29.1
67.7
29.3
0.2
35.4

Equity/reinvested earnings
212.3
59.0
0.7
16.7
45.7
-4.1
0.0
12.3
0.3
2.3
15.7
81.4
21.5
0.2
19.6

Other capital
6.3
-15.3
0.9
-3.8
-12.3
-0.1
0.0
-0.8
-0.1
-0.7
13.4
-13.7
7.9
0.0
15.7
Portfolio investment assets
74.2
56.4
14.4
19.9
-5.3
3.8
23.6
1.1
7.8
-28.2
4.9
14.0
-58.5
0.3
76.5
Equity
46.6
16.4
0.9
3.2
10.8
1.3
0.1
3.0
8.8
1.9
4.0
11.2
-30.9
0.0
32.2
Debt instruments
27.6
40.0
13.5
16.7
-16.1
2.4
23.4
-1.9
-1.0
-30.2
0.8
2.8
-27.6
0.2
44.3

Bonds and notes
29.3
40.8
12.4
18.4
-11.4
1.5
19.9
-1.6
-0.7
-25.5
-1.3
-9.3
-20.8
-0.2
47.9

Money market instruments
-1.8
-0.8
1.1
-1.7
-4.7
0.9
3.5
-0.3
-0.3
-4.7
2.1
12.1
-6.8
0.4
-3.6
Other investment
221.2
-11.0
-6.3
-4.1
4.5
-10.8
5.8
4.0
1.0
29.8
25.5
200.5
21.1
11.3
-61.0
Assets
-508.8 -160.6
3.6
0.3
-159.7
-7.4
2.6
-0.5
-1.7
-14.2
-72.7
-144.5
-29.0
-0.3
-85.2

General government
9.5
7.4
-0.5
4.7
2.3
0.0
0.8
0.0
-0.1
0.0
0.0
0.1
-0.2
1.2
1.2

MFIs
-416.8 -193.6
5.6
-4.4
-186.1
-8.3
-0.3
-1.6
-4.0
-10.8
-49.9
-66.9
-15.2
-1.5
-73.1

Other sectors
-101.5
25.6
-1.5
0.0
24.1
1.0
2.1
1.1
2.4
-3.3
-22.8
-77.7
-13.5
0.0
-13.3
Liabilities
-729.9 -149.6
9.9
4.4
-164.2
3.5
-3.2
-4.5
-2.7
-44.0
-98.2
-345.0
-50.0
-11.6
-24.3

General government
-6.9
-4.3
0.0
0.0
0.6
0.0
-5.0
0.1
0.0
-0.2
-0.3
-0.4
0.0
-2.0
0.3

MFIs
-586.0 -127.7
11.4
4.8
-142.3
2.7
-4.2
-3.8
-3.1
-45.0
-98.6
-234.1
-55.0
-9.5
-9.3

Other sectors
-137.1
-17.6
-1.5
-0.4
-22.5
0.8
6.0
-0.8
0.3
1.2
0.7
-110.5
5.0
-0.1
-15.3
Source: ECB.
ECB
Monthly Bulletin
July 2010 S 69

7.4 Monetary presentation of the balance of payments 1)
(EUR billions; transactions)

B.o.p. items mirroring net transactions by MFIs

Total
Current
Transactions by non-MFIs
Financial
Errors
and

derivatives
and
capital
Direct investment
Portfolio investment
Other investment
omissions
account

balance
By
By non-
Assets
Liabilities
Assets
Liabilities
resident
resident
units
units in
Equity
Debt
Equity
Debt
abroad
euro area
instruments
instruments
1
2
3
4
5
6
7
8
9
10
11
12
2007
-114.3
25.6
-459.4
395.0
-38.8
-162.6
144.5
218.4
-394.3
228.5
-64.0
-7.4
2008
-224.1
-137.0
-329.3
124.5
65.5
-22.4
-202.2
435.4
-143.8
67.7
-62.4
-20.2
2009
90.4
-47.8
-289.0
211.1
-49.5
-125.4
133.4
267.1
92.0
-143.9
39.9
2.4
2009 Q1
-38.4
-35.8
-83.6
36.5
32.5
4.9
-48.1
116.5
-13.3
-48.8
15.8
-15.1
Q2
77.9
-19.8
-79.7
85.7
-9.7
-73.1
46.3
90.2
64.5
-58.3
22.9
8.9
Q3
3.5
-2.2
-63.3
36.9
-35.9
-23.2
77.7
33.4
0.7
-30.9
-4.5
14.8
Q4
47.4
9.9
-62.3
52.0
-36.3
-34.1
57.5
27.0
40.2
-6.0
5.8
-6.2

2010 Q1
-77.1
-16.9
-41.0
19.1
-13.3
-55.3
27.3
-4.5
1.9
2.7
3.9
-1.1
2009 Apr.
18.1
-8.2
-58.8
72.8
5.3
-45.9
-26.0
42.3
-7.5
41.0
13.0
-9.9
May
6.3
-13.5
-5.3
20.6
-1.9
-33.9
26.5
29.9
83.7
-113.4
9.4
4.1
June
53.6
1.8
-15.7
-7.6
-13.1
6.7
45.8
18.0
-11.8
14.1
0.5
14.8
July
0.6
9.0
-10.8
18.9
-16.5
-21.2
35.3
-33.5
2.2
0.3
6.4
10.4
Aug.
20.4
-5.5
-13.9
17.1
-12.1
-22.1
48.3
5.1
9.4
-12.2
-9.8
16.3
Sep.
-17.5
-5.6
-38.6
0.9
-7.3
20.1
-5.9
61.8
-10.9
-18.9
-1.1
-11.9
Oct.
15.0
0.0
-31.0
28.9
-13.5
-12.7
-12.7
43.5
-19.2
31.5
1.8
-1.5
Nov.
-3.1
-1.0
-15.7
10.4
-14.9
-19.7
12.4
10.5
7.8
8.9
-0.1
-1.8
Dec.
35.5
10.9
-15.6
12.7
-7.9
-1.8
57.8
-27.1
51.6
-46.4
4.1
-2.8
2010 Jan.
-11.1
-13.0
-5.5
4.5
2.4
-23.5
18.6
-9.4
13.1
-1.8
5.1
-1.5
Feb.
-23.4
-5.3
-10.2
10.1
-2.5
-7.3
8.7
13.3
-10.9
-20.1
-0.1
0.7
Mar.
-42.7
1.4
-25.3
4.5
-13.2
-24.5
0.0
-8.4
-0.3
24.7
-1.1
-0.4

Apr.
-40.7
-7.1
-14.6
2.3
-2.9
-13.5
-0.3
27.3
-23.2
-7.4
-0.3
-1.1

12-month cumulated transactions

2010 Apr.
-7.1
-27.9
-202.1
123.3
-103.4
-153.3
234.6
131.1
91.4
-140.8
14.8
25.3
C36 Main b.o.p. items mirroring developments in MFI net external transactions 1)
(EUR billions; 12-month cumulated transactions)
total mirroring net external transactions by MFIs
current and capital account balance
direct and portfolio equity investment abroad by non-MFIs
portfolio investment liabilities of non-MFIs in the form of debt instruments
600
600
400
400
200
200
0
0
-200
-200
-400
-400
-600
-600
2007
2008
2009
Source: ECB.
1)
Data refer to the changing composition of the euro area. For further information, see the General Notes.
ECB
S Monthly Bulletin
70 July 2010

EURO AREA
STATISTICS
External
transactions
and
positions
7.5 Trade in goods
1. Values and volumes by product group 1)
(seasonally adjusted, unless otherwise indicated)

Total (n.s.a.)
Exports (f.o.b.)
Imports (c.i.f.)

Total
Memo item:
Total
Memo items:
Exports
Imports
Intermediate
Capital Consumption Manufacturing
Intermediate
Capital Consumption Manufacturing
Oil
1
2
3
4
5
6
7
8
9
10
11
12
13
Values (EUR billions; annual percentage changes for columns 1 and 2)
2008
3.9
8.1
1,561.6
771.0
337.9
414.0
1,305.0
1,611.3
1,019.2
233.2
333.9
1,022.7
293.6

2009
-18.1
-22.1
1,275.6
625.5
261.6
352.9
1,061.9
1,259.0
725.6
191.8
313.4
839.3
174.4
2009 Q2
-22.9
-26.8
310.3
153.2
63.6
85.2
258.5
305.2
172.7
47.5
77.5
205.3
41.6
Q3
-19.6
-25.7
318.8
157.1
64.6
88.6
266.2
313.1
179.7
47.4
78.8
207.5
47.5
Q4
-8.6
-14.5
330.2
163.2
67.2
92.5
275.5
320.0
189.3
47.2
78.0
210.9
49.2

2010 Q1
12.7
9.1
353.6
175.2
68.2
98.5
292.0
348.2
207.7
51.1
81.2
230.4
52.6
2009 Nov.
-5.9
-13.8
109.8
53.9
21.3
32.0
90.5
106.3
63.4
15.8
25.8
69.8
16.7
Dec.
-0.8
-5.7
112.1
55.3
23.5
30.9
93.6
109.0
64.2
16.2
26.5
71.5
16.5
2010 Jan.
3.9
0.7
112.2
56.4
20.4
31.4
91.9
110.4
66.6
16.2
26.8
73.6
17.3
Feb.
9.9
6.0
116.1
57.6
22.4
32.2
94.3
112.6
67.8
16.1
26.2
73.8
16.0
Mar.
22.7
20.3
125.4
61.2
25.4
34.9
105.7
125.1
73.3
18.8
28.2
83.1
19.3

Apr.
18.1
19.3
122.2
. .
. 100.7
120.6
. .
.
78.8
.
Volume indices (2000 = 100; annual percentage changes for columns 1 and 2)
2008
1.4
0.1
143.4
136.7
154.2
147.0
142.3
126.9
119.3
140.4
144.5
133.3
108.1

2009
-16.7
-14.6
119.2
114.7
117.8
126.7
115.5
108.7
99.7
113.8
134.9
110.4
97.1
2009 Q2
-21.6
-19.3
116.6
113.4
115.0
122.5
112.9
106.2
96.5
110.9
133.6
107.5
97.5
Q3
-17.5
-15.9
119.0
115.4
116.2
126.7
116.0
107.0
96.6
114.2
135.4
110.0
95.3
Q4
-6.0
-7.9
123.7
119.8
121.7
133.5
120.7
110.5
102.1
114.9
137.5
113.7
95.4

2010 Q1
11.3
3.5
129.6
125.3
122.9
138.0
125.7
114.5
105.5
120.1
139.0
120.2
94.0
2009 Nov.
-2.9
-6.2
123.9
118.1
116.3
139.8
119.1
110.5
103.0
115.6
136.6
113.1
95.2
Dec.
1.0
-2.7
125.3
121.5
126.5
132.2
122.5
111.6
102.2
118.0
139.3
115.0
94.3
2010 Jan.
3.2
-3.6
124.3
121.6
110.9
134.0
119.4
110.5
103.6
115.9
137.0
115.8
94.7
Feb.
9.0
1.1
127.4
123.8
121.0
134.7
121.6
111.5
103.4
114.3
135.2
115.8
87.0
Mar.
20.1
12.7
137.0
130.6
136.8
145.4
136.1
121.7
109.6
130.1
144.8
129.1
100.3

Apr.
. . .
. .
.
. .
. .
.
. .
2. Prices 2)
(annual percentage changes, unless otherwise indicated)

Industrial producer export prices (f.o.b.) 3)
Industrial import prices (c.i.f.)

Total
Total
Memo
Total
Total
Memo
(index:
item:
(index:
item:
2005 = 100)
Intermediate
Capital Consumer
Energy Manufac-
2005 = 100)
Intermediate
Capital Consumer
Energy Manufac-
goods
goods
goods
turing
goods
goods
goods
turing
% of total
100.0
100.0
32.2
46.3
17.7
3.8
99.4
100.0
100.0
28.4
27.9
22.1
21.6
81.1
1
2
3
4
5
6
7
8
9
10
11
12
13
14
2008
103.5
1.6
1.5
-0.4
2.4
25.2
1.5
112.7
6.5
0.2
-3.4
2.4
28.2
0.8

2009
100.9
-2.5
-4.1
0.6
0.5
-26.5
-2.5
102.2
-9.4
-5.8
-0.8
0.2
-26.5
-3.8
2009 Q3
100.9
-4.0
-6.2
0.7
0.4
-34.0
-3.8
102.3
-13.0
-7.8
-1.0
-0.3
-33.8
-5.2
Q4
100.6
-2.0
-5.2
-1.1
-0.5
6.8
-1.9
103.4
-3.3
-4.9
-2.1
-2.9
-2.9
-3.2

2010 Q1
102.5
1.3
-0.3
-0.2
0.6
37.8
1.4
107.6
6.1
2.5
-1.1
-0.9
26.7
1.5
2009 Dec.
100.6
-0.2
-3.7
-0.6
0.3
33.1
-0.1
103.9
1.9
-2.0
-1.7
-1.9
15.1
-1.0
2010 Jan.
101.8
0.4
-1.7
-0.7
0.4
32.2
0.5
106.2
4.6
0.5
-1.4
-1.2
22.9
0.4
Feb.
102.6
1.2
-0.4
-0.1
0.4
36.5
1.3
107.3
5.5
2.0
-1.1
-1.2
25.3
1.1
Mar.
103.2
2.3
1.2
0.3
1.1
44.4
2.4
109.3
8.1
5.0
-0.8
-0.3
31.8
2.9
Apr.
104.3
3.5
3.6
0.2
1.6
47.9
3.6
112.0
11.4
8.4
-0.3
0.7
41.2
4.6

May
105.3
4.4
5.6
0.9
2.6
35.2
4.4
112.8
11.6
11.5
1.4
3.0
33.3
6.6
Source: Eurostat.
1)
Product groups as classified in the Broad Economic Categories. Unlike the product groups shown in Table 2, intermediate and consumption product groups include
agricultural and energy products.
2)
Product groups as classified in the Main Industrial Groupings. Unlike the product groups shown in Table 1, intermediate and consumer goods do not include
energy products, and agricultural goods are not covered. Manufacturing has a different composition compared with the data shown in columns 7 and 12 of Table 1. Data shown
are price indices which follow the pure price change for a basket of products and are not simple ratios of the value and volume data shown in Table 1, which are affected
by changes in the composition and quality of traded goods. These indices differ from the GDP deflators for imports and exports (shown in Table 3 in Section 5.1), mainly
because those deflators include all goods and services and cover cross-border trade within the euro area.
3)
Industrial producer export prices refer to direct transactions between domestic producers and non-domestic customers. Contrary to the data shown for values and volumes in
Table 1, exports from wholesalers and re-exports are not covered.
ECB
Monthly Bulletin
July 2010 S 71

7.5 Trade in goods
(EUR billions, unless otherwise indicated; seasonally adjusted)
3. Geographical breakdown

Total EU Member States outside the euro area
Russia Switzer-
Turkey
United
Asia
Africa
Latin
Other
land
States
America countries
Denmark
Sweden
United
Other EU
China
Japan
Kingdom
countries
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
Exports (f.o.b.)
2008
1,561.6
35.1
53.9
220.4
233.7
78.5
86.7
42.7
187.1
309.5
65.7
33.7
100.2
68.1
145.6

2009
1,275.6
27.5
41.1
174.7
177.3
49.4
78.7
34.4
152.2
282.2
68.0
28.7
91.5
53.9
112.8
2008 Q4
362.5
8.1
11.5
48.6
52.5
17.8
21.1
8.4
44.3
74.2
15.8
8.1
24.9
17.2
33.8
2009 Q1
316.3
7.3
10.0
42.7
43.7
12.7
20.2
7.7
39.4
66.5
15.2
7.1
23.3
13.0
29.8
Q2
310.3
6.7
9.8
42.6
42.8
12.1
19.1
8.3
38.3
69.5
16.8
7.0
22.6
12.5
25.9
Q3
318.8
6.9
10.5
44.5
44.9
12.1
19.3
9.0
36.4
71.0
17.4
7.2
22.4
14.0
27.8
Q4
330.2
6.7
10.8
44.8
45.8
12.5
20.1
9.3
38.1
75.2
18.6
7.4
23.1
14.4
29.3

2010 Q1
353.6
6.9
11.7
46.6
47.7
13.5
21.4
10.8
41.5
81.4
22.2
8.0
24.9
16.7
30.8
2009 Nov.
109.8
2.2
3.5
14.4
15.2
4.2
6.9
3.1
12.8
24.6
6.3
2.4
7.7
4.8
10.4
Dec.
112.1
2.2
3.6
15.3
15.3
4.2
6.7
3.2
12.9
26.1
6.2
2.6
7.8
4.9
9.9
2010 Jan.
112.2
2.2
3.7
15.2
15.3
4.1
7.0
3.4
12.8
25.7
6.9
2.6
7.9
4.8
10.0
Feb.
116.1
2.3
3.8
14.9
15.6
4.2
6.9
3.6
12.8
26.7
7.4
2.7
8.3
5.8
11.1
Mar.
125.4
2.4
4.2
16.4
16.7
5.1
7.4
3.8
15.8
29.0
7.9
2.8
8.7
6.1
9.7

Apr.
122.2
. . . .
5.2
7.4
3.8
14.4
28.0
7.5
2.8
8.7
5.7
.

Percentage share of total exports

2009
100.0
2.2
3.2
13.7
13.9
3.9
6.2
2.7
11.9
22.1
5.3
2.3
7.2
4.2
8.8
Imports (c.i.f.)
2008
1,611.3
30.7
52.2
164.8
184.9
122.0
70.0
32.4
135.8
481.0
185.3
57.5
141.2
81.7
114.8

2009
1,259.0
26.5
37.8
126.0
162.2
81.4
64.9
26.2
116.0
377.0
159.2
43.0
93.6
59.1
88.1
2008 Q4
373.6
7.4
11.5
36.7
43.0
24.8
17.5
7.1
33.2
114.1
47.5
13.2
30.9
20.2
27.3
2009 Q1
320.6
6.9
9.5
31.5
39.0
17.8
16.7
6.6
31.8
97.3
41.4
11.5
23.9
14.7
25.0
Q2
305.2
6.5
9.0
30.6
39.3
18.1
16.1
6.3
30.2
92.3
39.6
10.2
22.9
14.2
19.9
Q3
313.1
6.8
9.7
31.7
41.1
21.8
16.1
6.6
26.0
93.3
39.0
10.8
22.6
14.8
22.5
Q4
320.0
6.4
9.6
32.2
42.8
23.7
16.0
6.8
28.0
94.1
39.2
10.5
24.3
15.5
20.7

2010 Q1
348.2
6.4
10.4
34.8
44.6
24.3
17.0
7.4
28.8
108.9
46.1
11.7
26.8
16.4
22.4
2009 Nov.
106.3
2.1
3.1
10.3
14.1
8.0
5.3
2.3
9.3
31.2
12.9
3.6
8.4
5.3
6.9
Dec.
109.0
2.1
3.4
11.0
14.4
7.9
5.5
2.1
9.5
31.8
13.6
3.5
8.5
5.3
7.3
2010 Jan.
110.4
2.1
3.2
11.4
14.4
8.2
5.5
2.5
9.6
34.0
13.3
3.8
8.2
5.2
6.1
Feb.
112.6
2.1
3.3
11.5
14.8
7.2
5.7
2.3
9.4
34.2
14.2
3.6
8.9
5.4
7.9
Mar.
125.1
2.3
3.9
12.0
15.4
8.9
5.8
2.6
9.8
40.7
18.6
4.3
9.7
5.8
8.3

Apr.
120.6
. . . .
8.5
5.8
2.5
9.9
38.3
16.4
4.1
10.0
5.8
.

Percentage share of total imports

2009
100.0
2.1
3.0
10.0
12.9
6.5
5.2
2.1
9.2
29.9
12.6
3.4
7.4
4.7
7.0
Balance
2008
-49.7
4.4
1.8
55.7
48.8
-43.5
16.8
10.4
51.3
-171.5
-119.6
-23.8
-41.0
-13.6
30.8

2009
16.6
1.0
3.3
48.7
15.0
-32.0
13.8
8.1
36.2
-94.8
-91.2
-14.3
-2.2
-5.3
24.8
2008 Q4
-11.0
0.7
0.1
12.0
9.5
-7.1
3.7
1.3
11.1
-40.0
-31.7
-5.1
-6.0
-2.9
6.6
2009 Q1
-4.4
0.4
0.4
11.2
4.7
-5.1
3.5
1.1
7.5
-30.8
-26.2
-4.4
-0.6
-1.7
4.8
Q2
5.1
0.2
0.9
12.1
3.5
-6.0
3.0
2.0
8.1
-22.8
-22.8
-3.2
-0.3
-1.7
6.0
Q3
5.8
0.1
0.8
12.8
3.8
-9.7
3.2
2.4
10.4
-22.3
-21.6
-3.6
-0.2
-0.8
5.3
Q4
10.1
0.3
1.2
12.6
3.0
-11.2
4.1
2.6
10.2
-18.9
-20.6
-3.1
-1.1
-1.1
8.6

2010 Q1
5.5
0.5
1.3
11.7
3.0
-10.9
4.4
3.4
12.7
-27.5
-23.9
-3.6
-1.9
0.3
8.4
2009 Nov.
3.6
0.1
0.4
4.1
1.1
-3.8
1.6
0.8
3.5
-6.6
-6.6
-1.2
-0.7
-0.4
3.5
Dec.
3.2
0.2
0.3
4.3
0.9
-3.7
1.2
1.1
3.3
-5.8
-7.4
-0.9
-0.7
-0.4
2.6
2010 Jan.
1.8
0.2
0.5
3.9
0.9
-4.1
1.5
0.9
3.3
-8.3
-6.3
-1.2
-0.3
-0.4
3.8
Feb.
3.4
0.2
0.5
3.4
0.8
-3.0
1.2
1.2
3.5
-7.5
-6.8
-0.9
-0.5
0.4
3.2
Mar.
0.2
0.1
0.3
4.4
1.3
-3.7
1.6
1.2
6.0
-11.7
-10.8
-1.5
-1.0
0.3
1.4

Apr.
1.6
. . . .
-3.4
1.6
1.3
4.5
-10.3
-8.9
-1.3
-1.2
0.0
.
Source: Eurostat.
ECB
S Monthly Bulletin
72 July 2010

EXCHANGE RATES
8
8.1 Effective exchange rates 1)
(period averages; index: 1999 Q1=100)

EER-21
EER-41
Nominal
Real
Real
Real
Real
Real
Nominal
Real
CPI
PPI
GDP
ULCM
ULCT
CPI
deflator
1
2
3
4
5
6
7
8
2007
106.3
106.8
105.2
102.6
106.8
100.8
113.0
104.2
2008
110.5
110.1
107.4
105.4
112.6
104.6
118.0
107.0

2009
111.7
110.6
105.9
106.3
119.1
106.9
120.6
107.8
2009 Q2
111.1
110.2
105.3
106.0
120.1
106.3
119.8
107.4
Q3
112.1
110.9
106.2
106.8
118.9
106.8
121.0
108.1
Q4
113.8
112.2
107.3
107.5
120.2
109.4
122.5
108.8
2010 Q1
108.7
106.9
102.3
102.4
114.5
104.1
116.9
103.2

Q2
103.1
101.7
97.3
. .
.
110.4
97.5
2009 June
112.0
111.1
106.2
- -
-
120.7
108.2
July
111.6
110.5
105.8
- -
-
120.5
107.7
Aug.
111.7
110.6
106.0
- -
-
120.6
107.8
Sep.
112.9
111.6
106.9
- -
-
122.0
108.7
Oct.
114.3
112.8
108.2
- -
-
123.0
109.5
Nov.
114.0
112.5
107.6
- -
-
122.9
109.2
Dec.
113.0
111.2
106.2
- -
-
121.7
107.8
2010 Jan.
110.8
108.9
104.1
- -
-
119.1
105.4
Feb.
108.0
106.1
101.6
- -
-
116.2
102.5
Mar.
107.4
105.7
101.1
- -
-
115.2
101.8
Apr.
106.1
104.5
100.2
- -
-
113.5
100.3
May
102.8
101.4
96.9
- -
-
109.9
97.1

June
100.7
99.2
94.8
- -
-
107.7
95.1

Percentage change versus previous month

2010 June
-2.1
-2.1
-2.2
- -
- -2.0
-2.1

Percentage change versus previous year

2010 June
-10.1
-10.7
-10.7
- -
-
-10.8
-12.1
C37 Effective exchange rates
C38 Bilateral exchange rates
(monthly averages; index: 1999 Q1=100)
(monthly averages; index: 1999 Q1=100)
USD/EUR
nominal EER-21
JPY/EUR
real CPI-deflated EER-21
GBP/EUR
150
150 150
150
140
140 140
140
130
130 130
130
120
120 120
120
110
110 110
110
100
100 100
100
90
90
90
90
80
80
80
80
70
70
70
70
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Source: ECB.
1)
For a definition of the trading partner groups and other information, please refer to the General Notes.
ECB
Monthly Bulletin
July 2010 S 73

8.2 Bilateral exchange rates
(period averages; units of national currency per euro)
Danish
Swedish
Pound
US
Japanese
Swiss South Korean Hong Kong
Singapore
Canadian
Norwegian
Australian
krone
krona
sterling
dollar
yen
franc
won
dollar
dollar
dollar
krone
dollar
1
2
3
4
5
6
7
8
9
10
11
12
2007
7.4506
9.2501
0.68434
1.3705
161.25
1.6427
1,272.99
10.6912
2.0636
1.4678
8.0165
1.6348
2008
7.4560
9.6152
0.79628
1.4708
152.45
1.5874
1,606.09
11.4541
2.0762
1.5594
8.2237
1.7416

2009
7.4462
10.6191
0.89094
1.3948
130.34
1.5100
1,772.90
10.8114
2.0241
1.5850
8.7278
1.7727
2009 Q4
7.4424
10.3509
0.90483
1.4779
132.69
1.5088
1,725.91
11.4555
2.0604
1.5604
8.3932
1.6250
2010 Q1
7.4426
9.9464
0.88760
1.3829
125.48
1.4632
1,581.41
10.7364
1.9395
1.4383
8.1020
1.5293

Q2
7.4416
9.6313
0.85239
1.2708
117.15
1.4086
1,481.01
9.8857
1.7674
1.3054
7.9093
1.4403
2009 Dec.
7.4419
10.4085
0.89972
1.4614
131.21
1.5021
1,703.03
11.3296
2.0392
1.5397
8.4066
1.6185
2010 Jan.
7.4424
10.1939
0.88305
1.4272
130.34
1.4765
1,624.76
11.0783
1.9930
1.4879
8.1817
1.5624
Feb.
7.4440
9.9505
0.87604
1.3686
123.46
1.4671
1,582.70
10.6305
1.9326
1.4454
8.0971
1.5434
Mar.
7.4416
9.7277
0.90160
1.3569
123.03
1.4482
1,542.59
10.5313
1.8990
1.3889
8.0369
1.4882
Apr.
7.4428
9.6617
0.87456
1.3406
125.33
1.4337
1,494.53
10.4065
1.8505
1.3467
7.9323
1.4463
May
7.4413
9.6641
0.85714
1.2565
115.83
1.4181
1,465.81
9.7843
1.7503
1.3060
7.8907
1.4436

June
7.4409
9.5723
0.82771
1.2209
110.99
1.3767
1,483.22
9.5091
1.7081
1.2674
7.9062
1.4315

Percentage change versus previous month

2010 June
0.0
-1.0
-3.4
-2.8
-4.2
-2.9
1.2
-2.8
-2.4
-3.0
0.2
-0.8

Percentage change versus previous year

2010 June
-0.1
-11.9
-3.4
-12.9
-18.0
-9.1
-16.1
-12.5
-16.1
-19.6
-11.6
-18.0
Czech
Estonian
Latvian
Lithuanian
Hungarian
Polish
Bulgarian
New Roma-
Croatian New Turkish
koruna
kroon
lats
litas
forint
zloty
lev
nian leu
kuna
lira
13
14
15
16
17
18
19
20
21
22
2007
27.766
15.6466
0.7001
3.4528
251.35
3.7837
1.9558
3.3353
7.3376
1.7865
2008
24.946
15.6466
0.7027
3.4528
251.51
3.5121
1.9558
3.6826
7.2239
1.9064

2009
26.435
15.6466
0.7057
3.4528
280.33
4.3276
1.9558
4.2399
7.3400
2.1631
2009 Q4
25.923
15.6466
0.7084
3.4528
270.88
4.1745
1.9558
4.2680
7.2756
2.2029

2010 Q1
25.868
15.6466
0.7087
3.4528
268.52
3.9869
1.9558
4.1135
7.2849
2.0866
Q2
25.591
15.6466
0.7078
3.4528
274.85
4.0171
1.9558
4.1854
7.2477
1.9560
2009 Dec.
26.089
15.6466
0.7077
3.4528
273.22
4.1439
1.9558
4.2284
7.2907
2.2013
2010 Jan.
26.133
15.6466
0.7088
3.4528
269.43
4.0703
1.9558
4.1383
7.2938
2.1028
Feb.
25.979
15.6466
0.7090
3.4528
271.21
4.0144
1.9558
4.1196
7.3029
2.0756
Mar.
25.541
15.6466
0.7083
3.4528
265.40
3.8906
1.9558
4.0866
7.2616
2.0821
Apr.
25.308
15.6466
0.7076
3.4528
265.53
3.8782
1.9558
4.1306
7.2594
1.9983
May
25.663
15.6466
0.7075
3.4528
276.78
4.0567
1.9558
4.1767
7.2630
1.9459

June
25.780
15.6466
0.7082
3.4528
281.49
4.1055
1.9558
4.2434
7.2225
1.9274

Percentage change versus previous month

2010 June
0.5
0.0
0.1
0.0
1.7
1.2
0.0
1.6
-0.6
-1.0

Percentage change versus previous year

2010 June
-2.9
0.0
1.0
0.0
0.4
-8.9
0.0
0.7
-1.0
-11.1
Brazilian
Chinese Icelandic
Indian Indonesian
Malaysian
Mexican New Zealand Philippine
Russian South African
Thai
real 1)
yuan renminbi
krona 2)
rupee 3)
rupiah
ringgit
peso 1)
dollar
peso
rouble
rand
baht
23
24
25
26
27
28
29
30
31
32
33
34
2007
2.6633
10.4178
87.63
56.4186
12,528.33
4.7076
14.9743
1.8627
63.026
35.0183
9.6596
44.214
2008
2.6737
10.2236
143.83
63.6143
14,165.16
4.8893
16.2911
2.0770
65.172
36.4207
12.0590
48.475

2009
2.7674
9.5277
- 67.3611
14,443.74
4.9079
18.7989
2.2121
66.338
44.1376
11.6737
47.804
2009 Q4
2.5703
10.0905
- 68.9088
13,999.42
5.0275
19.3003
2.0297
69.080
43.5740
11.0757
49.221
2010 Q1
2.4917
9.4417
- 63.4796
12,809.32
4.6590
17.6555
1.9510
63.593
41.2697
10.3852
45.472

Q2
2.2762
8.6717
- 57.9879
11,581.24
4.1172
15.9583
1.8145
57.848
38.5027
9.5974
41.152
2009 Dec.
2.5566
9.9777
- 68.0924
13,830.84
4.9859
18.7787
2.0383
67.706
43.9019
10.9261
48.544
2010 Jan.
2.5383
9.7436
- 65.5361
13,263.60
4.8170
18.2820
1.9646
65.702
42.5749
10.6492
47.150
Feb.
2.5237
9.3462
- 63.4291
12,786.05
4.6743
17.7154
1.9615
63.317
41.2845
10.4964
45.360
Mar.
2.4233
9.2623
- 61.7352
12,434.53
4.5083
17.0587
1.9301
61.999
40.1219
10.0589
44.111
Apr.
2.3550
9.1505
- 59.6203
12,101.70
4.2935
16.3957
1.8814
59.788
39.1335
9.8658
43.279
May
2.2750
8.5794
- 57.6166
11,517.01
4.0874
15.9856
1.8010
57.315
38.2707
9.6117
40.714

June
2.2057
8.3245
- 56.8582
11,169.39
3.9853
15.5346
1.7667
56.594
38.1507
9.3398
39.635

Percentage change versus previous month

2010 June
-3.0
-3.0
- -1.3
-3.0
-2.5
-2.8
-1.9
-1.3
-0.3
-2.8
-2.6

Percentage change versus previous year

2010 June
-19.5
-13.1
- -15.0
-22.0
-19.2
-16.8
-19.6
-15.6
-12.4
-17.1
-17.2
Source: ECB.
1)
For these currencies the ECB computes and publishes euro reference exchange rates as from 1 January 2008. Previous data are indicative.
2)
The most recent rate for the Icelandic krona refers to 3 December 2008.
3)
For this currency the ECB computes and publishes euro reference exchange rates as from 1 January 2009. Previous data are indicative.
ECB
S Monthly Bulletin
74 July 2010

DEVELOPMENTS OUTSIDE THE EURO AREA
9
9.1 In other EU Member States
(annual percentage changes, unless otherwise indicated)
1. Economic and financial developments
Bulgaria
Czech
Denmark
Estonia
Latvia
Lithuania
Hungary
Poland
Romania
Sweden
United
Republic
Kingdom
1
2
3
4
5
6
7
8
9
10
11
HICP
2008
12.0
6.3
3.6
10.6
15.3
11.1
6.0
4.2
7.9
3.3
3.6

2009
2.5
0.6
1.1
0.2
3.3
4.2
4.0
4.0
5.6
1.9
2.2
2009 Q4
0.9
0.0
0.9
-2.0
-1.3
1.2
4.9
3.8
4.5
2.3
2.1

2010 Q1
1.9
0.4
1.9
0.0
-3.9
-0.4
5.8
3.4
4.6
2.7
3.3
2010 Mar.
2.4
0.4
2.1
1.4
-4.0
-0.4
5.7
2.9
4.2
2.5
3.4

Apr.
3.0
0.9
2.4
2.5
-2.8
0.2
5.7
2.7
4.2
2.1
3.7
May
3.0
1.0
1.9
2.8
-2.4
0.5
4.9
2.3
4.4
1.9
3.4
General government deficit (-)/surplus (+) as a percentage of GDP
2007
0.1
-0.7
4.8
2.6
-0.3
-1.0
-5.0
-1.9
-2.5
3.8
-2.8
2008
1.8
-2.7
3.4
-2.7
-4.1
-3.3
-3.8
-3.7
-5.4
2.5
-4.9

2009
-3.9
-5.9
-2.7
-1.7
-9.0
-8.9
-4.0
-7.1
-8.3
-0.5
-11.5
General government gross debt as a percentage of GDP
2007
18.2
29.0
27.4
3.8
9.0
16.9
65.9
45.0
12.6
40.8
44.7
2008
14.1
30.0
34.2
4.6
19.5
15.6
72.9
47.2
13.3
38.3
52.0

2009
14.8
35.4
41.6
7.2
36.1
29.3
78.3
51.0
23.7
42.3
68.1
Long-term government bond yield as a percentage per annum; period average
2009 Dec.
6.61
3.98
3.53
- 13.75
9.10
7.69
6.22
8.66
3.24
3.60
2010 Jan.
6.65
4.28
3.57
- 13.76
8.15
7.62
6.13
9.05
3.37
4.01
Feb.
6.05
4.33
3.50
- 13.62
7.15
7.69
6.09
7.92
3.28
4.02
Mar.
5.82
4.02
3.40
- 10.54
5.15
7.16
5.72
7.11
3.20
3.98
Apr.
5.94
3.84
3.34
- 10.13
5.15
6.57
5.57
6.97
3.14
3.96

May
6.13
4.10
2.93
- 10.13
5.15
7.07
5.74
7.27
2.73
3.60
3-month interest rate as a percentage per annum; period average
2009 Dec.
4.71
1.64
1.55
3.28
8.39
4.54
7.47
4.23
10.18
0.48
0.61
2010 Jan.
4.44
1.55
1.46
2.74
4.77
3.07
6.78
4.24
8.56
0.48
0.61
Feb.
4.27
1.52
1.39
2.12
3.16
2.24
6.59
4.17
6.93
0.48
0.63
Mar.
4.21
1.43
1.37
1.86
2.33
1.87
6.65
4.13
6.01
0.49
0.65
Apr.
4.21
1.42
1.28
1.79
2.14
1.57
6.14
3.69
4.99
0.52
0.66

May
4.19
1.27
1.25
1.67
2.26
1.47
6.23
3.85
6.38
0.60
0.70
Real GDP
2008
6.0
2.5
-0.9
-3.6
-4.2
2.8
0.6
5.1
7.3
-0.4
0.5

2009
-5.0
-4.1
-4.7
-14.1
-18.0
-14.8
-6.3
1.8
-7.1
-5.1
-4.9
2009 Q3
-5.4
-4.4
-5.3
-15.6
-19.3
-14.7
-6.8
1.4
-7.1
-5.8
-5.3
Q4
-5.9
-3.2
-2.9
-9.5
-16.8
-12.5
-4.6
2.8
-6.5
-1.5
-3.1

2010 Q1
-3.6
1.1
-0.6
-2.0
-5.1
-2.6
-0.9
2.8
-2.6
2.9
-0.2
Current and capital account balance as a percentage of GDP
2008
-23.2
0.2
2.0
-8.4
-11.6
-10.1
-5.9
-3.9
-11.1
9.2
-1.3

2009
-8.0
0.1
3.9
7.4
12.0
7.2
1.5
0.0
-4.0
7.3
-1.1
2009 Q3
3.0
-2.0
5.6
10.9
11.9
8.0
2.8
-0.9
-2.8
7.0
-1.6
Q4
-7.1
0.9
5.0
9.9
14.8
13.2
2.2
-1.2
-3.9
5.5
-0.2

2010 Q1
-6.4
2.1
2.3
4.3
12.6
3.1
2.4
0.2
-6.1
8.2
.
Gross external debt as a percentage of GDP
2007
100.4
44.5
170.6
111.0
127.6
71.9
115.1
48.4
50.9
176.2
401.3

2008
108.8
50.0
179.0
118.5
129.2
71.6
155.0
56.5
56.0
203.8
431.4
2009 Q3
107.8
46.7
191.8
124.0
147.9
82.9
168.8
60.2
66.7
203.2
411.1

Q4
111.3
50.8
190.5
126.7
156.6
86.5
163.2
59.3
68.9
203.8
405.0
2010 Q1
. . .
124.7
161.8
. . . .
205.5
.
Unit labour costs
2008
16.2
5.1
6.5
14.1
22.0
9.3
4.5
6.8
14.5
2.6
2.8

2009
10.6
3.6
4.5
1.7
-7.1
0.9
1.5
2.3
5.1
4.8
4.9
2009 Q3
10.2
2.9
4.8
1.5
-12.9
-6.5
- 4.5
- 5.3
4.5

Q4
3.7
2.2
-1.6
-7.5
-20.2
-11.4
- -3.5
- 0.2
4.0
2010 Q1
6.6
-2.7
0.9
-8.9
-19.8
-9.5
- . -
-1.1
.
Standardised unemployment rate as a percentage of labour force (s.a.)
2008
5.6
4.4
3.4
5.5
7.5
5.9
7.8
7.2
5.8
6.2
5.7

2009
6.9
6.7
6.0
13.8
17.1
13.7
10.0
8.2
6.9
8.3
7.6
2009 Q4
8.2
7.4
7.1
15.6
19.8
15.9
10.6
8.9
7.6
8.8
7.8

2010 Q1
9.3
7.8
7.1
19.0
20.0
17.4
11.2
9.7
7.4
8.8
7.9
2010 Mar.
9.5
7.9
7.1
- 20.0
17.4
11.2
9.9
7.4
8.6
7.9
Apr.
9.7
7.6
7.0
- 22.5
. 10.9
9.9
. 9.1
.

May
9.7
7.5
6.8
- . .
10.4
9.8
.
8.8
.
Sources: European Commission (Economic and Financial Affairs DG and Eurostat), national data, Reuters and ECB calculations.
ECB
Monthly Bulletin
July 2010 S 75

9.2 In the United States and Japan
(annual percentage changes, unless otherwise indicated)
1. Economic and financial developments
Consumer
Unit labour
Real GDP
Industrial Unemployment
Broad
3-month
10-year
Exchange
Fiscal
Gross
price index
costs 1)
production
rate
money 2)
interbank
zero coupon
rate 4)
deficit (-)/
public
index
as a % of
deposit
government
as national
surplus (+)
debt 5)
(manufacturing)
labour force
rate 3) bond yield; 3)
currency
as a % of
as a % of
(s.a.)
end of
per euro
GDP
GDP
period
1
2
3
4
5
6
7
8
9
10
11
United States
2006
3.2
2.8
2.7
2.7
4.6
5.3
5.20
5.26
1.2556
-2.2
47.8
2007
2.9
2.3
2.1
3.2
4.6
6.3
5.30
4.81
1.3705
-2.8
48.4
2008
3.8
1.0
0.4
-4.4
5.8
7.1
2.93
2.70
1.4708
-6.5
56.3

2009
-0.4
-1.9
-2.4
-10.9
9.3
7.8
0.69
4.17
1.3948
-11.1
67.6
2009 Q2
-1.2
0.4
-3.8
-14.7
9.3
8.7
0.84
3.95
1.3632
-11.6
62.7
Q3
-1.6
-2.7
-2.6
-10.0
9.6
7.8
0.41
3.61
1.4303
-11.6
65.8
Q4
1.4
-5.2
0.1
-3.7
10.0
5.1
0.27
4.17
1.4779
-11.1
67.6
2010 Q1
2.4
-4.2
2.4
3.9
9.7
2.0
0.26
4.01
1.3829
-10.9
70.7

Q2
. .
. .
9.7
.
0.44
3.13
1.2708
.
.
2010 Feb.
2.1
- -
2.9
9.7
2.4
0.25
3.89
1.3686
- -
Mar.
2.3
- -
5.8
9.7
1.4
0.27
4.01
1.3569
- -
Apr.
2.2
- -
7.4
9.9
1.6
0.31
3.84
1.3406
- -

May
2.0
- -
9.4
9.7
1.7
0.46
3.52
1.2565
- -
June
. -
- .
9.5
.
0.54
3.13
1.2209
-
-
Japan
2006
0.2
-0.5
2.0
4.5
4.1
1.0
0.30
1.85
146.02
-1.6
159.9
2007
0.1
-1.0
2.3
2.8
3.8
1.6
0.79
1.70
161.25
-2.4
156.3
2008
1.4
2.6
-1.2
-3.4
4.0
2.1
0.93
1.21
152.45
-2.1
162.2

2009
-1.4
0.4
-5.3
-21.9
5.1
2.7
0.47
1.42
130.34
. .
2009 Q2
-1.0
0.9
-6.0
-27.4
5.1
2.6
0.53
1.41
132.59
. .
Q3
-2.2
1.0
-4.9
-19.4
5.4
2.8
0.40
1.45
133.82
. .
Q4
-2.0
-4.0
-1.4
-4.2
5.2
3.3
0.31
1.42
132.69
. .

2010 Q1
-1.2
. 4.2
27.6
4.9
2.8
0.25
1.48
125.48
. .
Q2
. .
. . .
.
0.24
1.18
117.15
.
.
2010 Feb.
-1.1
- - 31.5
4.8
2.7
0.25
1.43
123.46
- -
Mar.
-1.1
- - 31.9
5.0
2.7
0.25
1.48
123.03
- -
Apr.
-1.2
- - 25.9
5.1
2.9
0.24
1.37
125.33
- -
May
-0.9
- - 20.2
5.2
3.1
0.24
1.37
115.83
- -

June
. -
- . .
.
0.24
1.18
110.99
-
-
C39 Real gross domestic product
C40 Consumer price indices
(annual percentage changes; quarterly data)
(annual percentage changes; monthly data)
euro area
euro area 6)
United States
United States
Japan
Japan
6
6
6
6
4
4
4
4
2
2
0
0
2
2
-2
-2
-4
-4
0
0
-6
-6
-2
-2
-8
-8
-10
-10
-4
-4
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Sources: National data (columns 1, 2 (United States), 3, 4, 5 (United States), 6, 9 and 10); OECD (column 2 (Japan)); Eurostat (column 5 (Japan), euro area chart data); Reuters
(columns 7 and 8); ECB calculations (column 11).
1)
Seasonally adjusted. The data for the United States refer to the private non-agricultural business sector.
2)
Period averages; M2 for the United States, M2+CDs for Japan.
3)
Percentages per annum. For further information on the three-month interbank deposit rate, see Section 4.6.
4)
For more information, see Section 8.2.
5)
Gross consolidated general government debt (end of period).
6)
Data refer to the changing composition of the euro area. For further information, see the General Notes.
ECB
S Monthly Bulletin
76 July 2010

LIST OF CHARTS
C1 Monetary aggregates
S 1 2
C2 Counterparts
S 1 2
C3 Components of monetary aggregates
S 1 3
C4 Components of longer-term ﬁ nancial liabilities
S 1 3
C5 Loans to other ﬁ nancial intermediaries and non-ﬁ nancial corporations
S 1 4
C6 Loans to households
S 1 4
C7 Loans to government
S 1 6
C8 Loans to non-euro area residents
S 1 6
C9 Total deposits by sector (ﬁ nancial intermediaries)
S 1 7
C10 Total deposits and deposits included in M3 by sector (ﬁ nancial intermediaries)
S 1 7
C11 Total deposits by sector (non-ﬁ nancial corporations and households)
S 1 8
C12 Total deposits and deposits included in M3 by sector (non-ﬁ nancial corporations and households)
S 1 8
C13 Deposits by government and non-euro area residents
S 1 9
C14 MFI holdings of securities
S 2 0
C15 Total outstanding amounts and gross issues of securities other than shares issued by euro area residents
S 3 5
C16 Net issues of securities other than shares: seasonally adjusted and non-seasonally adjusted
S 3 7
C17 Annual growth rates of long-term debt securities, by sector of the issuer, in all currencies combined
S 3 8
C18 Annual growth rates of short-term debt securities, by sector of the issuer, in all currencies combined
S 3 9
C19 Annual growth rates for quoted shares issued by euro area residents
S 4 0
C20 Gross issues of quoted shares by sector of the issuer
S 4 1
C21 New deposits with an agreed maturity
S 4 3
C22 New loans with a ﬂ oating rate and up to 1 year’s initial rate ﬁ xation
S 4 3
C23 Euro area money market rates
S 4 4
C24 3-month money market rates
S 4 4
C25 Euro area spot yield curves
S 4 5
C26 Euro area spot rates and spreads
S 4 5
C27 Dow Jones EURO STOXX broad index, Standard & Poor’s 500 and Nikkei 225
S 4 6
C28 Deﬁ cit, borrowing requirement and change in debt
S 6 0
C29 Maastricht debt
S 6 0
C30 Euro area b.o.p: current account
S 6 1
C31 Euro area b.o.p: direct and portfolio investment
S 6 1
C32 Euro area b.o.p: goods
S 6 2
C33 Euro area b.o.p: services
S 6 2
C34 Euro area international investment position
S 6 5
C35 Euro area direct and portfolio investment position
S 6 5
C36 Main b.o.p. items mirroring developments in MFI net external transactions
S 7 0
C37 Effective exchange rates
S 7 3
C38 Bilateral exchange rates
S 7 3
C39 Real gross domestic product
S 7 6
C40 Consumer price indices
S 7 6
ECB
Monthly Bulletin
July 2010 S 77

TECHNICAL NOTES
EURO AREA OVERVIEW
and, for example, C
Q is the reclassiﬁ cation
t
adjustment in the quarter ending in month t.
CALCULATION OF GROWTH RATES FOR MONETARY
DEVELOPMENTS
For those quarterly series for which monthly
observations are now available (see below), the
The average growth rate for the quarter ending quarterly transactions can be derived as the sum
in month t is calculated as:
of the three monthly transactions in the quarter.
⎞
2
⎞
⎟
0.5I +
+ 0.5I
t
∑ It−i
t−3
⎟
a)
⎟
i=1
⎟ ×100
CALCULATION OF GROWTH RATES FOR MONTHLY
−1
⎟
2
⎟
SERIES
⎟ 0.5I
+
+ 0.5I
⎟
t
∑ It
t
⎠
−12
−i−12
−15
i=1
⎠
Growth rates can be calculated from transactions
where I is the index of adjusted outstanding or from the index of adjusted outstanding
t
amounts as at month t (see also below). amounts. If F
M and L are deﬁ ned as above,
t
t
Likewise, for the year ending in month t, the the index I of adjusted outstanding amounts in
t
average growth rate is calculated as:
month t is deﬁ ned as:
⎞
11
⎞
0.5I + ∑ I + 0.5I
FM
⎛
⎞
b)
⎟
t
t−i
t−12
⎟
e)
I
t
1
⎟
= I × +
i
⎜
⎟
=1
⎟
−1 ×100
t
t−1
L
⎟
11
⎟
⎝
t−1 ⎠
⎟ 0.5I
+
+ 0.5I
t
∑ It
t
⎟
−12
−i−12
−24
⎠
i=1
⎠
The base of the index (for the non-seasonally
SECTIONS 2.1 TO 2.6
adjusted series) is currently set as December
2006 = 100. Time series for the index of
CALCULATION OF TRANSACTIONS
adjusted outstanding amounts are available on
the ECB’s website (www.ecb.europa.eu) in the
Monthly transactions are calculated from “Monetary and ﬁ nancial statistics” sub-section
monthly differences in outstanding amounts of the “Statistics” section.
adjusted for reclassiﬁ cations, other revaluations,
exchange rate variations and any other changes The annual growth rate a for month t – i.e. the
t
which do not arise from transactions.
change in the 12 months ending in month t – can
be calculated using either of the following two
If L represents the outstanding amount at the end
formulae:
t
of month t, C M the reclassiﬁ cation adjustment
t
⎡ 11 ⎛
F M
⎞
⎤
in month t, E M the exchange rate adjustment
f)
a =
t−i
t
t
⎢
⎜
L
⎟
⎥ ×100
∏ 1 +
−1
and V M the other revaluation adjustments, the
t−1−i
⎣ i=0 ⎝
⎠
⎦
t
transactions F M in month t are deﬁ ned as:
t
⎛ I
c)
F
M = (L – L ) – C – E
M
– V
M
M
g)
t
⎞
t
t
t–1
t
t
t
a =
−1
t
⎜
I
⎟ × 100
⎝
t−12
⎠
Similarly, the quarterly transactions F Q for the
t
quarter ending in month t are deﬁ ned as:
Unless otherwise indicated, the annual growth
rates refer to the end of the indicated period.
d)
F
Q = (L – L ) – C – E
Q
– V
Q
Q
For example, the annual percentage change for
t
t
t–3
t
t
t
the year 2002 is calculated in g) by dividing
where L is the amount outstanding at the end the index for December 2002 by the index for
t-3
of month t-3 (the end of the previous quarter) December 2001.
ECB
Monthly Bulletin
July 2010 S 79

Growth rates for intra-annual periods can be adjustments arising from reclassiﬁ cations and
derived by adapting formula g). For example, revaluations, in turn yielding seasonally adjusted
the month-on-month growth rate aM
can be transactions. Seasonal (and trading day) factors
t
calculated as:
are revised at annual intervals or as required.
⎛
⎞
h)
M
It
a
⎜
⎟
SECTIONS 3.1 TO 3.5
=
−1 ×100
t
I
⎝
t−1
⎠
EQUALITY OF USES AND RESOURCES
Finally, the three-month moving average In Section 3.1 the data conform to a basic
(centred) for the annual growth rate of M3 is accounting identity. For non-ﬁ nancial
obtained as (a + a + a )/3, where a is deﬁ ned transactions, total uses equal total resources
t+1
t
t-1
t
as in f) or g) above.
for each transaction category. This accounting
identity is also reﬂ
ected in the ﬁ nancial
account – i.e. for each ﬁ nancial instrument
CALCULATION OF GROWTH RATES FOR
category, total transactions in ﬁ nancial assets
QUARTERLY SERIES
equal total transactions in liabilities. In the
other changes in assets account and the ﬁ nancial
If F Q and L are deﬁ ned as above, the index I balance sheets, total ﬁ nancial assets equal total
t
t-3
t
of adjusted outstanding amounts for the quarter liabilities for each ﬁ nancial instrument category,
ending in month t is deﬁ ned as:
with the exception of monetary gold and special
drawing rights, which are by deﬁ nition not a
liability of any sector.
⎛
F Q ⎞
i) I = I ×
t
1+
t
t
⎜
⎟
−3
⎝
Lt−3 ⎠
CALCULATION OF BALANCING ITEMS
The annual growth rate in the four quarters The balancing items at the end of each account in
ending in month t (i.e. a ) can be calculated Sections 3.1 and 3.2 are computed as follows.
t
using formula g).
The trade balance equals euro area imports
minus exports vis-à-vis the rest of the world for
SEASONAL ADJUSTMENT OF THE EURO AREA
goods and services.
MONETARY STATISTICS 1
The approach used is based on multiplicative 1 For details, see “Seasonal adjustment of monetary aggregates and
HICP for the euro area”, ECB (August 2000) and the “Monetary
decomposition using X-12-ARIMA.2 The
and ﬁ nancial statistics” sub-section of the “Statistics” section of
seasonal adjustment may include a day-of-the-
the ECB’s website (www.ecb.europa. eu).
week adjustment, and for some series it is carried
2 For details, see Findley, D., Monsell, B., Bell, W., Otto,
M. and Chen, B. C. (1998), “New Capabilities and Methods
out indirectly by means of a linear combination
of the X-12-ARIMA Seasonal Adjustment Program”, Journal
of components. This is the case for M3, which is
of Business and Economic Statistics, 16, 2, pp.127-152, or
“X-12-ARIMA Reference Manual”, Time Series Staff, Bureau
derived by aggregating the seasonally adjusted
of the Census, Washington, D.C.
series for M1, M2 less M1, and M3 less M2.
For internal purposes, the model-based approach of
TRAMO-SEATS is also used. For details of TRAMO-SEATS,
see Gomez, V. and Maravall, A. (1996), “Programs TRAMO and
The seasonal adjustment procedures are ﬁ rst
SEATS: Instructions for the User”, Banco de España, Working
applied to the index of adjusted outstanding
Paper No 9628, Madrid.
3 It follows that for the seasonally adjusted series, the level of the
amounts.3 The resulting estimates of seasonal
index for the base period (i.e. December 2001) generally differs
factors are then applied to the levels and to the
from 100, reﬂ ecting the seasonality of that month.
ECB
Monthly Bulletin
S 80 July 2010

E U R O A R E A
STATISTICS
Technical Notes
Net operating surplus and mixed income Changes in net worth (wealth) are calculated
is deﬁ ned for resident sectors only and is as changes in net worth (wealth) due to savings
calculated as gross value added (gross domestic and capital transfers plus other changes in net
product at market prices for the euro area) minus
ﬁ nancial worth (wealth). They currently exclude
compensation of employees (uses) minus other other changes in non-ﬁ nancial assets owing to
taxes less subsidies on production (uses) minus the unavailability of data.
consumption of ﬁ xed capital (uses).
Net ﬁ nancial worth (wealth) is calculated as
Net national income is deﬁ ned for resident total ﬁ nancial assets minus total liabilities,
sectors only and is computed as net operating whereas changes in net ﬁ nancial worth (wealth)
surplus and mixed income plus compensation of are equal to the sum of changes in net ﬁ nancial
employees (resources) plus taxes less subsidies worth (wealth) due to transactions (lending/net
on production (resources) plus net property borrowing from the ﬁ nancial account) and other
income (resources minus uses).
changes in net ﬁ nancial worth (wealth).
Net disposable income is also deﬁ ned only Finally, changes in net ﬁ nancial worth (wealth)
for resident sectors and equals net national due to transactions are computed as total
income plus net current taxes on income and transactions in ﬁ
nancial assets minus total
wealth (resources minus uses) plus net social transactions in liabilities, and other changes in
contributions (resources minus uses) plus net net ﬁ nancial worth (wealth) are calculated as
social beneﬁ ts other than social transfers in kind total other changes in ﬁ nancial assets minus
(resources minus uses) plus net other current total other changes in liabilities.
transfers (resources minus uses).
Net saving is deﬁ ned for resident sectors and SECTIONS 4.3 AND 4.4
is calculated as net disposable income plus
the net adjustment for the change in the net CALCULATION OF GROWTH RATES FOR DEBT
equity of households in pension fund reserves SECURITIES AND QUOTED SHARES
(resources minus uses) minus ﬁ nal consumption
expenditure (uses). For the rest of the world, the Growth rates are calculated on the basis of
current external account is compiled as the trade ﬁ nancial transactions and therefore exclude
balance plus all net income (resources minus reclassiﬁ
cations, revaluations, exchange rate
uses).
variations and any other changes which do not
arise from transactions. They can be calculated
Net lending/net borrowing is computed from from transactions or from the index of notional
the capital account as net saving plus net capital stocks. If N
M represents the transactions
t
transfers (resources minus uses) minus gross (net issues) in month t and L the level outstanding
t
capital formation (uses) minus acquisitions at the end of month t, the index I of notional
t
less disposals of non-produced non-ﬁ nancial stocks in month t is deﬁ ned as:
assets (uses) plus consumption of ﬁ xed capital
(resources). It can also be calculated in the
⎛
N ⎞
ﬁ nancial account as total transactions in ﬁ nancial
j) I = I ×
t
1+
t
t−1 ⎜
⎟
assets minus total transactions in liabilities
L
⎝
t−1 ⎠
(also known as changes in net ﬁ nancial worth
(wealth) due to transactions). For the household As a base, the index is set equal to 100 in
and non-ﬁ nancial corporation sectors, there is December 2001. The growth rate a for month
t
a statistical discrepancy between the balancing t, corresponding to the change in the 12 months
items computed from the capital account and ending in month t, can be calculated using either
the ﬁ nancial account.
of the following two formulae:
ECB
Monthly Bulletin
July 2010 S 81

k)
11
M
seasonal adjustment of total securities issues
⎡
⎛
⎞
a
N
⎤
=
t−i
t
⎢
⎜
L
⎟
⎥×100
∏ 1 +
−1
is carried out indirectly by means of a linear
t−1−i
⎣ i=0 ⎝
⎠
⎦
combination of sector and maturity component
breakdowns.
⎛ I
l)
a =
t
⎞
−1
t
⎜
I
⎟ ×100
⎝
t−12
⎠
The seasonal adjustment procedures are
applied to the index of notional stocks. The
The method used to calculate the growth rates resulting estimates of seasonal factors are then
for securities other than shares is the same as applied to the outstanding amounts, from which
that used for the monetary aggregates, the only seasonally adjusted net issues are derived.
difference being that an “N” is used instead of Seasonal factors are revised at annual intervals
an “F”. This is to show that the method used to or as required.
obtain “net issues” for securities issues statistics
differs from that used to calculate equivalent As in formulae k) and l), the growth rate a for
t
“transactions” for the monetary aggregates.
month t, corresponding to the change in the six
months ending in month t, can be calculated
The average growth rate for the quarter ending using either of the following two formulae:
in month t is calculated as:
⎞
2
⎞
5
M
0.5I
⎡
⎛
N
⎞
⎤
+
+ 0.5I
o)
⎟
a
t−i
t
∑ It
=
−i
t−3
⎟
t
⎢
⎜
L
⎟
⎥×100
∏ 1 +
−1
m)
⎟
i=1
t
−1 ⎟ ×100
−1−i
⎣ i=0 ⎝
⎠
⎦
⎟
2
⎟
⎟ 0.5I
+
+ 0.5I
⎟
t
∑ It
t
⎠
−12
−i−12
−15
i=1
⎠
⎛ I
p)
a =
t
⎞
−1
t
⎜
I
⎟ ×100
where I is the index of notional stocks as at
⎝
t−6
⎠
t
month t. Likewise, for the year ending in month
t, the average growth rate is calculated as:
11
TABLE 1 IN SECTION 5.1
⎞
⎞
⎟
0.5I +
+ 0.5I
t
∑ It−i
t−12
⎟
n)
⎟
i=1
⎟
SEASONAL ADJUSTMENT OF THE HICP 4
−1 ×100
⎟
11
⎟
⎟ 0.5I
+
+ 0.5I
t
∑ It
t
⎟
−12
−i−12
−24
⎠
i=1
⎠
The approach used is based on multiplicative
decomposition using X-12-ARIMA (see
The calculation formula used for Section 4.3 is footnote 2 on page S78). The seasonal
also used for Section 4.4 and is likewise based on adjustment of the overall HICP for the euro
that used for the monetary aggregates. Section 4.4
area is carried out indirectly by aggregating
is based on market values, and the calculations the seasonally adjusted euro area series for
are based on ﬁ
nancial transactions, which processed food, unprocessed food, industrial
exclude reclassiﬁ cations, revaluations and any goods excluding energy, and services. Energy
other changes that do not arise from transactions. is added without adjustment, since there is no
Exchange rate variations are not included, as all statistical evidence of seasonality. Seasonal
quoted shares covered are denominated in euro.
factors are revised at annual intervals or as
required.
SEASONAL ADJUSTMENT OF SECURITIES ISSUES
STATISTICS 4
4 For details, see “Seasonal adjustment of monetary aggregates and
HICP for the euro area”, ECB (August 2000) and the “Monetary
The approach used is based on multiplicative
and ﬁ nancial statistics” sub-section of the “Statistics” section of
decomposition using X-12-ARIMA. The
the ECB’s website (www.ecb.europa.eu).
ECB
Monthly Bulletin
S 82 July 2010

E U R O A R E A
STATISTICS
Technical Notes
TABLE 2 IN SECTION 7.1
SEASONAL ADJUSTMENT OF THE BALANCE OF
PAYMENTS CURRENT ACCOUNT
The approach used is based on multiplicative
decomposition using X-12-ARIMA
(see footnote 2 on page S78). The raw data for
goods, services and income are preadjusted
to take a working day effect into account. The
working day adjustment in goods and services
is corrected for national public holidays. The
seasonal adjustment of these items is carried
out using these preadjusted series. The seasonal
adjustment of the total current account is carried
out by aggregating the seasonally adjusted euro
area series for goods, services, income and
current transfers. Seasonal (and trading day)
factors are revised at biannual intervals or as
required.
SECTION 7.3
CALCULATION OF GROWTH RATES FOR THE
QUARTERLY AND ANNUAL SERIES
The annual growth rate for quarter t is calculated
on the basis of quarterly transactions (F ) and
t
positions (L ) as follows:
t
t
⎛
⎛
Fi ⎞ ⎞
a = ⎜
⎜
— ⎟
⎟
−1 ×100
t
∏ 1 +
⎝
L
i=t-3 ⎝
i-l
⎠ ⎠
The growth rate for the annual series is equal to
the growth rate in the last quarter of the year.
ECB
Monthly Bulletin
July 2010 S 83

GENERAL NOTES
The “Euro area statistics” section of the 11 EU Member States: Belgium, Germany,
Monthly Bulletin focuses on statistics for the Ireland, Spain, France, Italy, Luxembourg,
euro area as a whole. More detailed and longer the Netherlands, Austria, Portugal and Finland.
runs of data, with further explanatory notes, are Data from 2001 to 2006 refer to the Euro 12,
available in the “Statistics” section of the ECB’s i.e. the Euro 11 plus Greece. Data for 2007 refer
website (www.ecb.europa.eu). This allows user-
to the Euro 13, i.e. the Euro 12 plus Slovenia.
friendly access to data via the ECB’s Statistical Data for 2008 refer to the Euro 15, i.e. the Euro 13
Data Warehouse (http://sdw.ecb.europa.eu), plus Cyprus and Malta, and data as of 2009 refer
which includes search and download facilities. to the Euro 16, i.e. the Euro 15 plus Slovakia.
Further services available in the “Data services”
sub-section include subscriptions to different Given that the composition of the European
datasets and a repository of compressed Comma currency unit (ECU) does not coincide with the
Separated Value (CSV) ﬁ
les. For further former currencies of the countries that have
information, please contact us at: statistics@
adopted the single currency, pre-1999 amounts
ecb.europa.eu.
originally expressed in the participating
currencies and converted into ECU at current
In general, the cut-off date for the statistics ECU exchange rates are affected by movements
included in the Monthly Bulletin is the day in the currencies of EU Member States that have
preceding the Governing Council of the ECB’s not adopted the euro. To avoid this effect on the
ﬁ rst meeting of the month. For this issue, monetary statistics, pre-1999 data 1 are expressed
the cut-off date was 7 July 2010.
in units converted from national currencies at
the irrevocable euro exchange rates established
Unless otherwise indicated, all data series on 31 December 1998. Unless otherwise
including observations for 2009 and beyond indicated, price and cost statistics before 1999
relate to the Euro 16 (the euro area including are based on data expressed in national
Slovakia) for the whole time series. For interest
currency terms.
rates, monetary statistics and the HICP
(and, for consistency reasons, the components Methods of aggregation and/or consolidation
and counterparts of M3 and the components (including cross-country consolidation) have
of the HICP), statistical series refer to the been used where appropriate.
changing composition of the euro area
(see below for details). Where applicable, Recent data are often provisional and may be
this is indicated in the tables by means of a revised. Discrepancies between totals and their
footnote. In such cases, where underlying data components may arise from rounding.
are available, absolute and percentage changes
for the respective year of entry into the euro The group “Other EU Member States” comprises
area of Greece (2001), Slovenia (2007), Cyprus
Bulgaria, the Czech Republic, Denmark,
(2008), Malta (2008) and Slovakia (2009), Estonia, Latvia, Lithuania, Hungary, Poland,
calculated from bases covering the year prior Romania, Sweden and the United Kingdom.
to the year of entry, use a series in which the
impact of these countries’ joining the euro area In most cases, the terminology used within the
is taken into account.
tables follows international standards, such
as those contained in the European System
The statistical series referring to the changing
composition of the euro area are based on 1 Data on monetary statistics in Sections 2.1 to 2.8 are available
the euro area composition at the time to
for periods prior to January 1999 on the ECB’s website
(http://www.ecb.europa.eu/stats/services/downloads/html/index.
which the statistics relate. Thus, data prior to
en.html) and in the SDW (http://sdw.ecb.europa.eu/browse.
2001 refer to the Euro 11, i.e. the following
do?node=2018811).
ECB
Monthly Bulletin
July 2010 S 85

of Accounts 1995 and the IMF Balance Table 2 in Section 1.4 contains average data
of Payments Manual. Transactions refer to for completed maintenance periods. First,
voluntary exchanges (measured directly or the reserve requirement of each individual
derived), while ﬂ ows also encompass changes credit institution is calculated by applying the
in outstanding amounts owing to price reserve ratios for the corresponding categories
and exchange rate changes, write-offs and of liability to the eligible liabilities, using the
other changes.
balance sheet data from the end of each calendar
month. Subsequently, each credit institution
In the tables, the wording “up to (x) years” deducts from this ﬁ gure a lump-sum allowance
means “up to and including (x) years”.
of €100,000. The resulting required reserves are
then aggregated at the euro area level (column 1).
Current account holdings (column 2) are the
OVERVIEW
aggregate average daily current account holdings
of credit institutions, including those that serve
Developments in key indicators for the euro area
to fulﬁ l reserve requirements. Excess reserves
are summarised in an overview table.
(column 3) are the average current account
holdings over the maintenance period in excess
of the required reserves. Deﬁ ciencies (column 4)
MONETARY POLICY STATISTICS
are deﬁ ned as the average shortfalls of current
account holdings from required reserves over
Section 1.4 shows statistics on minimum reserve
the maintenance period, computed on the basis
and liquidity factors. Maintenance periods for of those credit institutions that have not fulﬁ lled
minimum reserve requirements start every month
their reserve requirements. The interest rate on
on the settlement day of the main reﬁ nancing minimum reserves (column 5) is equal to the
operation (MRO) following the Governing average, over the maintenance period, of the
Council meeting for which the monthly ECB’s rate (weighted according to the number
assessment of the monetary policy stance is of calendar days) on the Eurosystem’s MROs
scheduled. They end on the day preceding the (see Section 1.3).
corresponding settlement day in the following
month. Annual/quarterly observations refer to Table 3 in Section 1.4 shows the banking
averages for the last reserve maintenance period system’s liquidity position, which is deﬁ ned
of the year/quarter.
as euro area credit institutions’ current account
holdings with the Eurosystem in euro. All
Table 1 in Section 1.4 shows the components amounts are derived from the consolidated
of the reserve base of credit institutions ﬁ nancial statement of the Eurosystem. Other
subject to reserve requirements. Liabilities liquidity-absorbing operations (column 7)
vis-à-vis other credit institutions subject to exclude the issuance of debt certiﬁ cates
the ESCB’s minimum reserve system, the initiated by NCBs in Stage Two of EMU. Net
ECB and participating national central banks other factors (column 10) represent the netted
are excluded from the reserve base. When a remaining items in the consolidated ﬁ nancial
credit institution cannot provide evidence of statement of the Eurosystem. Credit institutions’
the amount of its issues of debt securities with current accounts (column 11) are equal to
a maturity of up to two years which are held the difference between the sum of liquidity-
by the institutions mentioned above, it may providing factors (columns 1 to 5) and the sum
deduct a certain percentage of these liabilities of liquidity-absorbing factors (columns 6 to 10).
from its reserve base. The percentage used Base money (column 12) is calculated as the
to calculate the reserve base was 10% until sum of the deposit facility (column 6), banknotes
November 1999 and has been 30% since in circulation (column 8) and credit institutions’
that date.
current account holdings (column 11).
ECB
Monthly Bulletin
S 86 July 2010

E U R O A R E A
STATISTICS
General Notes
MONEY, BANKING AND INVESTMENT FUNDS
the euro area banking system. Section 2.6 shows
the securities held by the euro area banking
Section 2.1 shows the aggregated balance sheet system, broken down by type of issuer.
of the monetary ﬁ nancial institution sector,
i.e. the sum of the harmonised balance sheets of Sections 2.2 to 2.6 include data on transactions,
all MFIs resident in the euro area. MFIs comprise
which are derived as differences in outstanding
central banks, credit institutions as deﬁ ned amounts adjusted for reclassiﬁ cations,
under Community law, money market funds and revaluations, exchange rate variations and any
other institutions whose business it is to receive other changes that do not arise from transactions.
deposits and/or close substitutes for deposits Section 2.7 shows selected revaluations that
from entities other than MFIs and, for their own are used in the derivation of transactions.
account (at least in economic terms), to grant Sections 2.2 to 2.6 also provide growth rates
credit and/or make investments in securities. based on those transactions in the form of
A complete list of MFIs is published on the annual percentage changes. Section 2.8 shows a
ECB’s website.
quarterly currency breakdown of selected MFI
balance sheet items.
Section 2.2 shows the consolidated balance
sheet of the MFI sector, which is obtained by Details of sector deﬁ nitions are set out in the
netting the aggregated balance sheet positions of
third edition of the “Monetary ﬁ nancial
MFIs in the euro area. Owing to a small amount institutions and markets statistics sector manual –
of heterogeneity in recording practices, the sum Guidance for the statistical classiﬁ cation of
of the inter-MFI positions is not necessarily customers” (ECB, March 2007). The publication
zero; the balance is shown in column 10 of “Guidance Notes to the Regulation ECB/2001/13
the liabilities side of Section 2.2. Section 2.3 on the MFI Balance Sheet Statistics” (ECB,
sets out the euro area monetary aggregates November 2002) explains practices that NCBs
and counterparts. These are derived from the are recommended to follow. Since
consolidated MFI balance sheet and include 1 January 1999, statistical information has been
positions of non-MFIs resident in the euro area collected and compiled on the basis of
held with MFIs resident in the euro area; they Regulation ECB/1998/16 of 1 December 1998
also take account of some monetary assets/
concerning the consolidated balance sheet of the
liabilities of central government. Statistics monetary ﬁ nancial institutions sector,2 as last
on monetary aggregates and counterparts are amended by Regulation ECB/2003/10 3.
adjusted for seasonal and trading day effects.
The external liabilities item in Sections 2.1 In line with this Regulation, the balance sheet
and 2.2 shows the holdings by non-euro area item “money market paper” has been merged
residents of: (i) shares/units issued by money with the item “debt securities” on both the assets
market funds located in the euro area; and and liabilities sides of the MFI balance sheet.
(ii) debt securities issued with a maturity of up
to two years by MFIs located in the euro area. Section 2.9 shows outstanding amounts and
In Section 2.3, however, these holdings are transactions on the balance sheet of euro area
excluded from the monetary aggregates and investment funds (other than money market
contribute to the item “net external assets”.
funds, which are included in the MFI balance
sheet statistics). An investment fund is a
Section 2.4 provides analysis, broken down collective investment undertaking that invests
by sector, type and original maturity, of loans capital raised from the public in ﬁ nancial and/
granted by MFIs other than the Eurosystem or non-ﬁ nancial assets. A complete list of euro
(i.e. the banking system) resident in the euro
area. Section 2.5 provides analysis, broken down
2 OJ L 356, 30.12.1998, p. 7.
by sector and instrument, of deposits held with 3 OJ L 250, 2.10.2003, p. 19.
ECB
Monthly Bulletin
July 2010 S 87

area investment funds is published on the ECB’s
whole; the balancing item of the primary income
website. The balance sheet is aggregated, so account is national income); (3) the secondary
investment funds' assets include their holdings distribution of income account, which shows
of shares/units issued by other investment how the national income of an institutional
funds. Shares/units issued by investment funds sector changes because of current transfers;
are also broken down by investment policy (4) the use of income account, which shows how
(i.e. into bond funds, equity funds, mixed disposable income is spent on consumption or
funds, real estate funds, hedge funds and other saved; (5) the capital account, which shows how
funds) and by type (i.e. into open-end funds and savings and net capital transfers are spent in the
closed-end funds). Section 2.10 provides further acquisition of non-ﬁ nancial assets (the balancing
details on the main types of asset held by euro item of the capital account is net lending/
area investment funds. This Section contains net borrowing); and (6) the ﬁ nancial account,
a geographical breakdown of the issuers of which records the net acquisitions of ﬁ nancial
securities held by investment funds, as well assets and the net incurrence of liabilities. As
as breaking issuers down by economic sector each non-ﬁ nancial transaction is mirrored by a
where they are resident in the euro area.
ﬁ nancial transaction, the balancing item of the
ﬁ nancial account conceptually also equals net
Further information on these investment fund lending/net borrowing as calculated from the
statistics can be found in the “Manual on capital account.
investment fund statistics”. Since December 2008
harmonised statistical information has been In addition, opening and closing ﬁ nancial
collected and compiled on the basis of balance sheets are presented, which provide a
Regulation ECB/2007/8 concerning statistics on picture of the ﬁ nancial wealth of each individual
the assets and liabilities of investment funds.
sector at a given point in time. Finally, other
changes in ﬁ
nancial assets and liabilities
(e.g. those resulting from the impact of changes
EURO AREA ACCOUNTS
in asset prices) are also shown.
Section 3.1 shows quarterly integrated euro area The sectoral coverage of the ﬁ nancial account
accounts data, which provide comprehensive and the ﬁ nancial balance sheets is more detailed
information on the economic activities of for the ﬁ
nancial corporation sector, which
households (including non-proﬁ t institutions is broken down into MFIs, other ﬁ nancial
serving households), non-ﬁ nancial corporations, intermediaries (including ﬁ nancial auxiliaries),
ﬁ nancial corporations and general government, and insurance corporations and pension funds.
as well as on the interaction between these
sectors and both the euro area and the rest of the Section 3.2 shows four-quarter cumulated ﬂ ows
world. Non-seasonally adjusted data on current (transactions) for the “non-ﬁ nancial accounts”
prices are displayed for the last available quarter, of the euro area (i.e. accounts (1) to (5) above),
following a simpliﬁ ed sequence of accounts in also following the simpliﬁ
ed sequence of
accordance with the methodological framework accounts.
of the European System of Accounts 1995.
Section 3.3 shows four-quarter cumulated ﬂ ows
In short, the sequence of accounts (transactions) (transactions and other changes) for households’
comprises: (1) the generation of income account, income, expenditure and accumulation accounts,
which shows how production activity translates as well as outstanding amounts for the ﬁ nancial
into various categories of income; (2) the balance sheet accounts, presenting data in
allocation of primary income account, which a more analytical manner. Sector-speciﬁ c
records receipts and expenses relating to various transactions and balancing items are arranged
forms of property income (for the economy as a in a way that more clearly depicts the ﬁ nancing
ECB
Monthly Bulletin
S 88 July 2010

E U R O A R E A
STATISTICS
General Notes
and investment decisions of households, while with an original maturity of one year or less
respecting the accounting identities presented in (in exceptional cases, two years or less).
Sections 3.1 and 3.2.
Securities with (i) a longer maturity, (ii) optional
maturity dates, the latest of which is more than
Section 3.4 displays four-quarter cumulated ﬂ ows one year away, or (iii) indeﬁ nite maturity dates
(transactions) for non-ﬁ nancial corporations’ are classiﬁ ed as “long-term”. Long-term debt
income and accumulation accounts, as well as securities issued by euro area residents are
outstanding amounts for the ﬁ nancial balance broken down further into ﬁ xed and variable rate
sheet accounts, presenting data in a more issues. Fixed rate issues consist of issues where
analytical manner.
the coupon rate does not change during the life
of the issue. Variable rate issues comprise all
Section 3.5 shows four-quarter cumulated issues where the coupon is periodically reﬁ xed
ﬁ nancial ﬂ ows (transactions and other changes) with reference to an independent interest rate
and outstanding amounts for the ﬁ nancial or index. The euro-denominated securities
balance sheets of insurance corporations and indicated in Sections 4.1, 4.2 and 4.3 also include
pension funds.
items expressed in national denominations of
the euro.
FINANCIAL MARKETS
Section 4.1 shows securities other than shares,
broken down by original maturity, residency of
The series on ﬁ nancial market statistics for the the issuer and currency. It presents outstanding
euro area cover those EU Member States that amounts, gross issues and net issues of
had adopted the euro at the time to which the securities other than shares, broken down into:
statistics relate (i.e. a changing composition), (i) issues denominated in euro and issues in all
with the exception of statistics on securities currencies; (ii) issues by euro area residents
issues (Sections 4.1 to 4.4), which relate to the and total issues; and (iii) total and long-term
Euro 16 for the whole time series (i.e. a ﬁ xed maturities. Net issues differ from the changes
composition).
in outstanding amounts owing to valuation
changes, reclassiﬁ cations and other adjustments.
Statistics on securities other than shares and This section also presents seasonally adjusted
statistics on quoted shares (Sections 4.1 to statistics, including six-month annualised
4.4) are produced by the ECB using data from seasonally adjusted growth rates for total and
the ESCB and the BIS. Section 4.5 presents long-term debt securities. Seasonally adjusted
MFI interest rates on euro-denominated data are derived from the index of notional
deposits from and loans to euro area residents. stocks, from which the seasonal effects have
Statistics on money market interest rates, long-
been removed. See the Technical Notes for
term government bond yields and stock market details.
indices (Sections 4.6 to 4.8) are produced by
the ECB using data from wire services.
Section 4.2 contains a sectoral breakdown
of outstanding amounts, gross issues and net
Statistics on securities issues cover: (i) securities issues for issuers resident in the euro area in line
other than shares, excluding ﬁ nancial derivatives; with the ESA 95. The ECB is included in the
and (ii) quoted shares. The former are presented Eurosystem.
in Sections 4.1, 4.2 and 4.3, while the latter
are presented in Section 4.4. Debt securities are The total outstanding amounts for total and
broken down into short-term and long-term long-term debt securities in column 1 of Table 1 in
securities. “Short-term” means securities Section 4.2 correspond to the data on outstanding
ECB
Monthly Bulletin
July 2010 S 89

amounts for total and long-term debt securities reclassiﬁ cations, revaluations and any other
issued by euro area residents in column 7 of changes that do not arise from transactions.
Section 4.1. The outstanding amounts for total
and long-term debt securities issued by MFIs in Section 4.5 presents statistics on all the interest
column 2 of Table 1 in Section 4.2 are broadly rates that MFIs resident in the euro area apply
comparable with the data on debt securities issued to euro-denominated deposits and loans vis-à-vis
on the liabilities side of the aggregated MFI households and non-ﬁ nancial corporations
balance sheet in column 8 of Table 2 in Section 2.1.
resident in the euro area. Euro area MFI interest
The total net issues for total debt securities in rates are calculated as a weighted average
column 1 of Table 2 in Section 4.2 correspond to (by corresponding business volume) of the euro
the data on total net issues by euro area residents area countries’ interest rates for each category.
in column 9 of Section 4.1. The residual difference
between long-term debt securities and total ﬁ xed MFI interest rate statistics are broken down by
and variable rate long-term debt securities in type of business coverage, sector, instrument
Table 1 of Section 4.2 consists of zero coupon category and maturity, period of notice or initial
bonds and revaluation effects.
period of interest rate ﬁ xation. These MFI
interest rate statistics replaced the ten transitional
Section 4.3 shows seasonally adjusted and statistical series on euro area retail interest rates
non-seasonally adjusted growth rates for debt that had been published in the Monthly Bulletin
securities issued by euro area residents (broken as of January 1999.
down by maturity, type of instrument, sector
of the issuer and currency), which are based Section 4.6 presents money market interest rates
on ﬁ nancial transactions that occur when an for the euro area, the United States and Japan.
institutional unit incurs or redeems liabilities. The
For the euro area, a broad spectrum of money
growth rates therefore exclude reclassiﬁ cations, market interest rates is covered, ranging from
revaluations, exchange rate variations and any interest rates on overnight deposits to those on
other changes that do not arise from transactions.
twelve-month deposits. Before January 1999,
The seasonally adjusted growth rates have been synthetic euro area interest rates were calculated
annualised for presentational purposes. See the on the basis of national rates weighted by
Technical Notes for details.
GDP. With the exception of the overnight rate
prior to January 1999, monthly, quarterly and
Columns 1, 4, 6 and 8 in Table 1 of Section 4.4 yearly values are period averages. Overnight
show the outstanding amounts of quoted shares deposits are represented by end-of-period
issued by euro area residents broken down by interbank deposit bid rates up to and including
issuing sector. The monthly data for quoted December 1998 and period averages for the euro
shares issued by non-ﬁ nancial corporations overnight index average (EONIA) thereafter.
correspond to the quarterly series shown in As of January 1999, euro area interest rates on
Section 3.4 (ﬁ nancial balance sheet; quoted one, three, six and twelve-month deposits are
shares).
euro interbank offered rates (EURIBOR); prior
to that date, they are London interbank offered
Columns 3, 5, 7 and 9 in Table 1 of Section 4.4 rates (LIBOR) where available. For the United
show annual growth rates for quoted shares States and Japan, interest rates on three-month
issued by euro area residents (broken down by deposits are represented by LIBOR.
the sector of the issuer), which are based on
ﬁ nancial transactions that occur when an issuer Section 4.7 shows end-of-period rates estimated
issues or redeems shares for cash, excluding from nominal spot yield curves based on
investments in the issuer’s own shares. AAA-rated euro-denominated bonds issued by
The calculation of annual growth rates excludes euro area central governments. The yield curves
ECB
Monthly Bulletin
S 90 July 2010

E U R O A R E A
STATISTICS
General Notes
are estimated using the Svensson model 4. Spreads
(NACE Revision 2), as covered by Regulation
between the ten-year rates and the three-month (EC) No 1893/2006 of the European Parliament
and two-year rates are also released. Additional and of the Council of 20 December 2006
yield curves (daily releases, including charts and establishing the statistical classiﬁ cation
tables) and the corresponding methodological of economic activities NACE Revision 2 and
information are available at: http://www.ecb.
amending Council Regulation (EEC)
europa.eu/stats/money/yc/html/index.en.html. No 3037/90, as well as certain EC Regulations
Daily data can also be downloaded.
on speciﬁ c statistical domains,6 has been applied
in the production of short-term statistics. The
Section 4.8 shows stock market indices for the breakdown by end-use of product for industrial
euro area, the United States and Japan.
producer prices and industrial production is the
harmonised sub-division of industry excluding
construction (NACE Revision 2, sections B
PRICES, OUTPUT, DEMAND AND LABOUR MARKETS
to E) into Main Industrial Groupings (MIGs)
as deﬁ ned by Commission Regulation (EC)
Most of the data described in this section are No 656/2007 of 14 June 2007 7. Industrial
produced by the European Commission (mainly producer prices reﬂ ect the ex-factory gate prices
Eurostat) and national statistical authorities. Euro
of producers. They include indirect taxes except
area results are obtained by aggregating data VAT and other deductible taxes. Industrial
for individual countries. As far as possible, the production reﬂ ects the value added of the
data are harmonised and comparable. Statistics industries concerned.
on labour costs indices, GDP and expenditure
components, value added by economic activity, The two non-energy commodity price indices
industrial production, retail sales passenger car shown in Table 3 in Section 5.1 are compiled
registrations and employment in terms of hours with the same commodity coverage, but using
worked are working day-adjusted.
two different weighting schemes: one based on
the respective commodity imports of the euro
The Harmonised Index of Consumer Prices area (columns 2-4), and the other (columns 5-7)
(HICP) for the euro area (Table 1 in Section 5.1) based on estimated euro area domestic demand,
is available from 1995 onwards. It is based or “use”, taking into account information on
on national HICPs, which follow the same imports, exports and the domestic production
methodology in all euro area countries. The of each commodity (ignoring, for the sake of
breakdown into goods and services components simplicity, inventories, which are assumed to
is derived from the classiﬁ cation of individual be relatively stable over the observed period).
consumption by purpose (Coicop/HICP). The import-weighted commodity price index is
The HICP covers monetary expenditure by appropriate for analysing external developments,
households on ﬁ nal consumption in the economic
while the use-weighted index is suitable for
territory of the euro area. The table includes the speciﬁ c purpose of analysing international
seasonally adjusted HICP data and experimental commodity price pressures on euro area inﬂ ation.
HICP-based estimates of administered prices, The use-weighted commodity price indices are
which are compiled by the ECB.
experimental data. For more details as regards
the compilation of the ECB commodity price
Industrial producer prices (Table 2 in indices, see Box 1 in the December 2008 issue
Section 5.1), industrial production, industrial of the Monthly Bulletin.
new orders, industrial turnover and retail sales 4 Svensson, L. E., “Estimating and Interpreting Forward Interest
(Section 5.2) are covered by Council Regulation
Rates: Sweden 1992-1994”, Centre for Economic Policy
(EC) No 1165/98 of 19 May 1998 concerning
Research, Discussion Paper No 1051, 1994.
5 OJ L 162, 5.6.1998, p. 1.
short-term statistics5. Since January 2009 the 6 OJ L 393, 30.12.2006, p. 1.
revised classiﬁ cation of economic activities 7 OJ L 155, 15.6.2007, p. 3.
ECB
Monthly Bulletin
July 2010 S 91

The labour cost indices (Table 5 in Section 5.1) Unemployment rates (Table 4 in Section 5.3)
measure the changes in labour costs per hour conform to International Labour Organization
worked in industry (including construction) and guidelines. They refer to persons actively
market services. Their methodology is laid down
seeking work as a share of the labour force,
in Regulation (EC) No 450/2003 of the European
using harmonised criteria and deﬁ nitions.
Parliament and of the Council of 27 February The labour force estimates underlying the
2003 concerning the labour cost index 8 and in unemployment rate are different from the sum
the implementing Commission Regulation (EC) of the employment and unemployment levels
No 1216/2003 of 7 July 2003 9. A breakdown published in Section 5.3.
of the labour cost indices for the euro area is
available by labour cost component (wages and
salaries, and employers’ social contributions plus
GOVERNMENT FINANCE
employment-related taxes paid by the employer
less subsidies received by the employer) and by Sections 6.1 to 6.5 show the general government
economic activity. The ECB calculates the ﬁ scal position in the euro area. The data are
indicator of negotiated wages (memo item mainly consolidated and are based on the
in Table 3 of Section 5.1) on the basis of ESA 95 methodology. The annual euro area
non-harmonised, national-deﬁ nition data.
aggregates in Sections 6.1 to 6.3 are compiled
by the ECB on the basis of harmonised data
Unit labour cost components (Table 4 in provided by the NCBs, which are regularly
Section 5.1), GDP and its components (Tables 1 updated. The deﬁ cit and debt data for the euro
and 2 in Section 5.2), GDP deﬂ ators (Table 3 area countries may therefore differ from those
in Section 5.1) and employment statistics used by the European Commission within the
(Tables 1, 2 and 3 in Section 5.3) are derived excessive deﬁ cit procedure. The quarterly euro
from the ESA 95 quarterly national accounts.
area aggregates in Sections 6.4 and 6.5 are
compiled by the ECB on the basis of Eurostat
Industrial new orders (Table 4 in Section 5.2) and national data.
measure the orders received during the reference
period and cover industries working mainly on Section 6.1 presents annual ﬁ gures on general
the basis of orders – in particular the textile, pulp
government revenue and expenditure on the
and paper, chemical, metal, capital goods and basis of deﬁ nitions laid down in Commission
durable consumer goods industries. The data are Regulation (EC) No 1500/2000 of 10 July 2000 10
calculated on the basis of current prices.
amending the ESA 95. Section 6.2 shows details
of general government gross consolidated debt
Indices for turnover in industry and for the at nominal value in line with the Treaty
retail trade (Table 4 in Section 5.2) measure the provisions on the excessive deﬁ cit procedure.
turnover, including all duties and taxes (with Sections 6.1 and 6.2 include summary data for
the exception of VAT), invoiced during the the individual euro area countries owing to their
reference period. Retail trade turnover covers all importance within the framework of the Stability
retail trade (excluding sales of motor vehicles and Growth Pact. The deﬁ cits/surpluses
and motorcycles), except automotive fuel. New presented for the individual euro area countries
passenger car registrations cover registrations of correspond to excessive deﬁ cit procedure B.9,
both private and commercial passenger cars. The
as deﬁ
ned by Council Regulation (EC)
euro area series excludes Cyprus and Malta.
No 479/2009 as regards references to the
ESA 95. Section 6.3 presents changes in general
Qualitative business and consumer survey data
8 OJ L 69, 13.3.2003, p. 1.
(Table 5 in Section 5.2) draw on the European 9 OJ L 169, 8.7.2003, p. 37.
Commission Business and Consumer Surveys.
10 OJ L 172, 12.7.2000, p. 3.
ECB
Monthly Bulletin
S 92 July 2010

E U R O A R E A
STATISTICS
General Notes
government debt. The difference between the Monetary, Financial and Balance of Payments
change in the government debt and the Statistics (www.cmfb.org). The annual quality
government deﬁ cit – the deﬁ cit-debt adjustment – report on the euro area b.o.p./i.i.p., which is
is mainly explained by government transactions based on the Task Force’s recommendations
in ﬁ nancial assets and by foreign exchange and follows the basic principles of the ECB
valuation effects. Section 6.4 presents quarterly Statistics Quality Framework published in
ﬁ gures on general government revenue and April 2008, is available on the ECB’s website.
expenditure on the basis of deﬁ nitions laid down
in Regulation (EC) No 1221/2002 of the The tables in Sections 7.1 and 7.4 follow
European Parliament and of the Council of the sign convention in the IMF Balance of
10 June 2002 on quarterly non-ﬁ nancial accounts Payments Manual – i.e. surpluses in the current
for general government 11. Section 6.5 presents account and the capital account have a plus
quarterly
ﬁ
gures on gross consolidated sign, while in the ﬁ nancial account a plus sign
government debt, the deﬁ cit-debt adjustment denotes an increase in liabilities or a decrease
and the government borrowing requirement. in assets. In the tables in Section 7.2, both credit
These ﬁ gures are compiled using data provided and debit transactions are presented with a plus
by the Member States under Regulation (EC) sign. Furthermore, as of the February 2008
No 501/2004 and Regulation (EC) No 222/2004 issue of the Monthly Bulletin, the tables in
and data provided by the NCBs.
Section 7.3 have been restructured in order to
allow the data on the balance of payments, the
international investment position and related
EXTERNAL TRANSACTIONS AND POSITIONS
growth rates to be presented together; in the new
tables, transactions in assets and liabilities that
The concepts and deﬁ nitions used in balance of correspond to increases in positions are shown
payments and international investment position with a plus sign.
(i.i.p.) statistics (Sections 7.1 to 7.4) are
generally in line with the IMF Balance of The euro area b.o.p. is compiled by the ECB.
Payments Manual (ﬁ fth edition, October 1993), Recent monthly ﬁ gures should be regarded as
the ECB Guideline of 16 July 2004 on the provisional. Data are revised when ﬁ gures for
statistical reporting requirements of the ECB the following month and/or the detailed quarterly
(ECB/2004/15)12 and the amending ECB b.o.p. are published. Earlier data are revised
Guideline of 31 May 2007 (ECB/2007/3) 13. periodically or as a result of methodological
Additional information regarding the
changes in the compilation of the source data.
methodologies and sources used in the euro area
b.o.p. and i.i.p. statistics can be found in the Table 1 in Section 7.2 also contains seasonally
ECB publication entitled “European Union adjusted data for the current account. Where
balance of payments/international investment appropriate, the adjustment also covers working
position statistical methods” (May 2007) and in day, leap year and/or Easter-related effects.
the reports of the Task Force on Portfolio Table 3 in Section 7.2 and Table 9 in Section 7.3
Investment Collection Systems (June 2002), the present a breakdown of the euro area b.o.p. and
Task Force on Portfolio Investment Income i.i.p. vis-à-vis major partner countries, both
(August 2003) and the Task Force on Foreign individually and as a group, distinguishing
Direct Investment (March 2004), all of which between EU Member States outside the euro
can be downloaded from the ECB’s website. In area and countries or areas outside the European
addition, a report by the ECB/European Union. The breakdown also shows transactions
Commission (Eurostat) Task Force on Quality and positions vis-à-vis EU institutions (which,
looking at balance of payments and international
11 OJ L 179, 9.7.2002, p. 1.
investment position statistics (June 2004) is 12 OJ L 354, 30.11.2004, p. 34.
available on the website of the Committee on 13 OJ L 159, 20.6.2007, p. 48.
ECB
Monthly Bulletin
July 2010 S 93

with the exception of the ECB, are considered In Table 5 in Section 7.3, the breakdown into
to be outside the euro area for statistical “loans” and “currency and deposits” is based
purposes, regardless of their physical location) on the sector of the non-resident counterpart –
and, for some purposes, offshore centres and i.e. assets vis-à-vis non-resident banks are
international organisations. The breakdown does
classiﬁ ed as deposits, whereas assets vis-à-vis
not cover transactions or positions in portfolio other non-resident sectors are classiﬁ ed as loans.
investment liabilities, ﬁ nancial derivatives or This breakdown follows the distinction made in
international reserves. In addition, separate data other statistics, such as the MFI consolidated
are not provided for investment income payable balance sheet, and conforms to the IMF Balance
to Brazil, mainland China, India or Russia. The of Payments Manual.
geographical breakdown is described in the
article entitled “Euro area balance of payments The outstanding amounts for the Eurosystem’s
and international investment position vis-à-vis international reserves and related assets and
main counterparts” in the February 2005 issue liabilities are shown in Table 7 of Section 7.3.
of the Monthly Bulletin.
These ﬁ gures are not fully comparable with
those in the Eurosystem’s weekly ﬁ nancial
The data on the euro area b.o.p. ﬁ nancial account statement owing to differences in coverage
and i.i.p. in Section 7.3 are based on transactions
and valuation. The data in Table 7 are in line
and positions vis-à-vis non-residents of the euro with the recommendations for the template on
area, regarding the euro area as a single economic international reserves and foreign currency
entity (see also Box 9 in the December 2002 liquidity. Changes in the gold holdings of the
issue of the Monthly Bulletin, Box 5 in the Eurosystem (column 3) are due to transactions
January 2007 issue of the Monthly Bulletin and in gold within the terms of the Central Bank
Box 6 in the January 2008 issue of the Monthly Gold Agreement of 26 September 1999, which
Bulletin). The i.i.p. is valued at current market was updated on 27 September 2009. More
prices, with the exception of direct investment, information on the statistical treatment of the
where book values are used for unquoted shares, Eurosystem’s international reserves can be found
and other investments (e.g. loans and deposits). in a publication entitled “Statistical treatment
The quarterly i.i.p. is compiled on the basis of the
of the Eurosystem’s international reserves”
same methodological framework as the annual (October 2000), which can be downloaded from
i.i.p. As some data sources are not available on the ECB’s website. The website also contains
a quarterly basis (or are available with a delay), more comprehensive data in accordance with the
the quarterly i.i.p. is partly estimated on the template on international reserves and foreign
basis of ﬁ nancial transactions, asset prices and currency liquidity.
foreign exchange developments.
The euro area’s gross external debt statistics
Table 1 in Section 7.3 summarises the i.i.p. and in Table 8 of Section 7.3 represent outstanding
ﬁ nancial transactions in the euro area b.o.p. actual (rather than contingent) liabilities vis-à-vis
The breakdown of the change in the annual non-euro area residents that require the payment
i.i.p. is obtained by applying a statistical model of principal and/or interest by the debtor at one
to i.i.p. changes other than transactions, using or more points in the future. Table 8 shows a
information from the geographical breakdown breakdown of gross external debt by instrument
and currency composition of assets and and institutional sector.
liabilities, as well as price indices for different
ﬁ nancial assets. In this table, columns 5 and Section 7.4 contains a monetary presentation
6 refer to direct investment by resident units of the euro area balance of payments, showing
abroad and direct investment by non-resident the transactions by non-MFIs that mirror the net
units in the euro area.
external transactions by MFIs. Included in the
ECB
Monthly Bulletin
S 94 July 2010

E U R O A R E A
STATISTICS
General Notes
transactions by non-MFIs are b.o.p. transactions reﬂ ects the cost, insurance and freight price
for which a sectoral breakdown is not available. excluding import duties and taxes, and refers to
These concern the current and capital accounts actual transactions in euro recorded at the point
(column 2) and ﬁ nancial derivatives (column 11).
when ownership of the goods is transferred.
An up-to-date methodological note on the The industrial producer export prices cover all
monetary presentation of the euro area balance industrial products exported directly by euro
of payments is available in the “Statistics” area producers to the extra-euro area market
section of the ECB’s website. See also Box 1 in under sections B to E of NACE Revision 2.
the June 2003 issue of the Monthly Bulletin.
Exports from wholesalers and re-exports are
not covered. The indices reﬂ ect the free on
Section 7.5 shows data on euro area external board price expressed in euro and calculated
trade in goods. The source is Eurostat. Value data
at the euro area frontier, including any indirect
and volume indices are seasonally and working taxes except VAT and other deductible taxes.
day-adjusted. The breakdown by product Industrial import prices and industrial producer
group in columns 4 to 6 and 9 to 11 of Table 1 export prices are available by Main Industrial
in Section 7.5 is in line with the classiﬁ cation Grouping as deﬁ ned by Commission Regulation
contained in the Broad Economic Categories (EC) No 656/2007 of 14 June 2007. For more
and corresponds to the basic classes of goods in details, see Box 11 in the December 2008 issue
the System of National Accounts. Manufactured of the Monthly Bulletin.
goods (columns 7 and 12) and oil (column 13)
are in line with the SITC Rev. 4 deﬁ nition. The
geographical breakdown (Table 3 in Section 7.5)
EXCHANGE RATES
shows major trading partners both individually
and in regional groups. China excludes Hong Section 8.1 shows nominal and real effective
Kong. On account of differences in deﬁ nitions, exchange rate indices for the euro, which are
classiﬁ cation, coverage and time of recording, calculated by the ECB on the basis of weighted
external trade data, in particular for imports, are averages of the euro’s bilateral exchange rates
not fully comparable with the goods item in the against the currencies of the selected trading
b.o.p. statistics (Sections 7.1 and 7.2). Part of the
partners of the euro area. A positive change
difference arises from the inclusion of insurance denotes an appreciation of the euro. Weights
and freight services in the recording of imported are based on trade in manufactured goods with
goods in external trade data.
those trading partners in the periods 1995-1997,
1998-2000, 2001-2003 and 2004-2006, and are
Industrial import prices and industrial producer calculated to account for third-market effects.
export prices (or industrial output prices for The EER indices are obtained by chain-linking
the non-domestic market) shown in Table 2 the indicators based on each of these four sets
in Section 7.5 were introduced by Regulation of trade weights at the end of each three-year
(EC) No 1158/2005 of the European Parliament period. The base period of the resulting EER
and of the Council of 6 July 2005 amending index is the ﬁ rst quarter of 1999. The EER-21
Council Regulation (EC) No 1165/98, which is group of trading partners is composed of the
the principal legal basis for short-term statistics. 11 non-euro area EU Member States plus
The industrial import price index covers Australia, Canada, China, Hong Kong, Japan,
industrial products imported from outside the Norway, Singapore, South Korea, Switzerland
euro area under sections B to E of the Statistical and the United States. The EER-41 group
Classiﬁ cation of Products by Activity in the comprises the EER-21 plus the following
European Economic Community (CPA) and all countries: Algeria, Argentina, Brazil, Chile,
institutional import sectors except households, Croatia, Iceland, India, Indonesia, Israel,
governments and non-proﬁ
t institutions. It Malaysia, Mexico, Morocco, New Zealand,
ECB
Monthly Bulletin
July 2010 S 95

the Philippines, Russia, South Africa, Taiwan,
Thailand, Turkey and Venezuela. Real EERs
are calculated using consumer price indices,
producer price indices, gross domestic product
deﬂ ators and unit labour costs, both for the
manufacturing sector and for the total economy.
For more detailed information on the calculation
of the EERs, see Box 5, entitled “International
trade developments and revision of the effective
exchange rates of the euro”, in the January 2010
issue of the Monthly Bulletin, the relevant
methodological note and ECB Occasional
Paper No 2 (“The effective exchange rates of
the euro” by Luca Buldorini, Stelios Makrydakis
and Christian Thimann, February 2002), which
can be downloaded from the ECB’s website.
The bilateral rates shown in Section 8.2 are
monthly averages of those published daily as
reference rates for these currencies.
DEVELOPMENTS OUTSIDE THE EURO AREA
Statistics on other EU Member States
(Section 9.1) follow the same principles as data
relating to the euro area. As a result, data on
current and capital accounts and gross external
debt include special-purpose vehicles. The data
for the United States and Japan contained in
Section 9.2 are obtained from national sources.
ECB
Monthly Bulletin
S 96 July 2010

A N N E X E S
CHRONOLOGY OF MONETARY POLICY
MEASURES OF THE EUROSYSTEM1
11 JANUARY AND 8 FEBRUARY 2007
5 JULY, 2 AUGUST, 6 SEPTEMBER, 4 OCTOBER,
8 NOVEMBER AND 6 DECEMBER 2007, AND
The Governing Council of the ECB decides 10 JANUARY, 7 FEBRUARY, 6 MARCH, 10 APRIL,
that the minimum bid rate on the main 8 MAY AND 5 JUNE 2008
reﬁ nancing operations and the interest rates on
the marginal lending facility and the deposit The Governing Council of the ECB decides that
facility will remain unchanged at 3.50%, the minimum bid rate on the main reﬁ nancing
4.50% and 2.50% respectively.
operations and the interest rates on the marginal
lending facility and the deposit facility will
remain unchanged at 4.00%, 5.00% and 3.00%
8 MARCH 2007
respectively.
The Governing Council of the ECB decides
to increase the minimum bid rate on the main 3 JULY 2008
reﬁ nancing operations by 25 basis points to
3.75%, starting from the operation to be settled The Governing Council of the ECB decides
on 14 March 2007. In addition, it decides to to increase the minimum bid rate on the main
increase the interest rates on both the marginal reﬁ nancing operations by 25 basis points
lending facility and the deposit facility by to 4.25%, starting from the operation to be
25 basis points, to 4.75% and 2.75%, both with settled on 9 July 2008. In addition, it decides
effect from 14 March 2007.
to increase by 25 basis points the interest
rates on both the marginal lending facility
and the deposit facility, to 5.25% and 3.25%
12 APRIL AND 10 MAY 2007
respectively, with effect from 9 July 2008.
The Governing Council of the ECB decides
that the minimum bid rate on the main 7 AUGUST, 4 SEPTEMBER AND
reﬁ nancing operations and the interest rates on 2 OCTOBER 2008
the marginal lending facility and the deposit
facility will remain unchanged at 3.75%, 4.75%
The Governing Council of the ECB decides that
and 2.75% respectively.
the minimum bid rate on the main reﬁ nancing
operations and the interest rates on the marginal
lending facility and the deposit facility will
6 JUNE 2007
remain unchanged at 4.25%, 5.25% and 3.25%
respectively.
The Governing Council of the ECB decides
to increase the minimum bid rate on the main
reﬁ nancing operations by 25 basis points to 8 OCTOBER 2008
4%, starting from the operation to be settled on
13 June 2007. In addition, it decides to increase The Governing Council of the ECB decides
by 25 basis points the interest rates on both to decrease the minimum bid rate on the main
the marginal lending facility and the deposit reﬁ nancing operations by 50 basis points to
facility, to 5% and 3% respectively, with effect 3.75%, starting from the operations to be settled
from 13 June 2007.
on 15 October 2008. In addition, it decides to
decrease by 50 basis points the interest rates on
1 The chronology of monetary policy measures taken by the
Eurosystem between 1999 and 2006 can be found in the ECB’s
Annual Report for the respective years.
ECB
Monthly Bulletin
July 2010
I

both the marginal lending facility and the deposit operations of the Eurosystem by 75 basis points
facility, to 4.75% and 2.75% respectively, with to 2.50%, starting from the operations to be
immediate effect. Moreover, the Governing settled on 10 December 2008. In addition,
Council decides that, as from the operation settled
it decides to decrease by 75 basis points the
on 15 October, the weekly main reﬁ nancing interest rates on both the marginal lending
operations will be carried out through a ﬁ xed-
and the deposit facility to 3.00% and 2.00%
rate tender procedure with full allotment at the respectively, with effect from 10 December
interest rate on the main reﬁ nancing operation. 2008.
Furthermore, as of 9 October, the ECB will
reduce the corridor of standing facilities from
200 basis points to 100 basis points around the 18 DECEMBER 2008
interest rate on the main reﬁ nancing operation.
The two measures will remain in place for as The Governing Council of the ECB decides
long as needed, and at least until the end of the that the main reﬁ
nancing operations will
ﬁ rst maintenance period of 2009, on 20 January.
continue to be carried out through a ﬁ xed rate
tender procedure with full allotment beyond the
maintenance period ending on 20 January 2009.
15 OCTOBER 2008
This measure will be in place for as long as
needed, and at least until the last allotment of the
The Governing Council of the ECB decides to third maintenance period in 2009 on 31 March.
further expand the collateral framework and Moreover, as of 21 January 2009, the corridor of
enhance the provision of liquidity. To do so, the standing facility rates, which on 9 October 2008
Governing Council decides: (i) to expand the was reduced to 100 basis points around the
list of assets eligible as collateral in Eurosystem prevailing interest rate of the main reﬁ nancing
credit operations, with this expansion remaining operation, will be re-widened symmetrically to
in force until the end of 2009, (ii) to enhance 200 basis points.
the provision of longer-term reﬁ nancing, with
effect from 30 October 2008 and until the end of
the ﬁ rst quarter of 2009, and (iii) to provide US 15 JANUARY 2009
dollar liquidity through foreign exchange swaps.
The Governing Council of the ECB decides
to decrease the interest rate on the main
6 NOVEMBER 2008
reﬁ nancing operations by 50 basis points to
2.00%, starting from the operations to be settled
The Governing Council of the ECB decides on 21 January 2009. In addition, it decides that
to decrease the interest rate on the main the interest rates on the marginal lending and
reﬁ nancing operations by 50 basis points to the deposit facility will be 3.00% and 1.00%
3.25%, starting from the operations to be settled respectively, with effect from 21 January 2009,
on 12 November 2008. In addition, it decides to in line with the decision of 18 December 2008.
decrease by 50 basis points the interest rates on
both the marginal lending facility and the deposit
facility, to 3.75% and 2.75% respectively, with 5 FEBRUARY 2009
effect from 12 November 2008.
The Governing Council of the ECB decides
that the interest rate on the main reﬁ nancing
4 DECEMBER 2008
operations and the interest rates on the marginal
lending facility and the deposit facility will
The Governing Council of the ECB decides to remain unchanged at 2.00%, 3.00% and 1.00%
decrease the interest rate on the main reﬁ nancing respectively.
ECB
Monthly Bulletin
II
July 2010

C H R O N O L O G Y
5 MARCH 2009
on the deposit facility unchanged at 0.25%.
In addition, the Governing Council of the ECB
The Governing Council of the ECB decides decides to proceed with its enhanced credit
to decrease the interest rate on the main support approach. In particular, it decides that
reﬁ nancing operations by 50 basis points to the Eurosystem will conduct liquidity-providing
1.50%, starting from the operations to be settled longer-term reﬁ
nancing operations with a
on 11 March 2009. In addition, it decides that maturity of one year as ﬁ xed rate tender
the interest rates on the marginal lending and procedure with full allotment. In addition, it
the deposit facility will be 2.50% and 0.50% decides in principle that the Eurosystem will
respectively, with effect from 11 March 2009.
purchase euro-denominated covered bonds
issued in the euro area.
Moreover, the Governing Council decides
to continue the ﬁ xed rate tender procedure
with full allotment for all main reﬁ nancing 4 JUNE 2009
operations, special-term reﬁ nancing operations
and supplementary and regular longer-term The Governing Council of the ECB decides
reﬁ nancing operations for as long as needed, that the interest rate on the main reﬁ nancing
and in any case beyond the end of 2009. In operations and the interest rates on the marginal
addition, the Governing Council decides lending facility and the deposit facility will
to continue with the current frequency and remain unchanged at 1.00%, 1.75% and 0.25%
maturity proﬁ
le of supplementary longer-
respectively. In addition, the Governing Council
term reﬁ nancing operations and special-term of the ECB decides upon the technical modalities
reﬁ nancing operations for as long as needed, related to the purchase of euro-denominated
and in any case beyond the end of 2009.
covered bonds issued in the euro area decided
on 7 May 2009.
2 APRIL 2009
2 JULY, 6 AUGUST, 3 SEPTEMBER, 8 OCTOBER,
The Governing Council of the ECB decides 5 NOVEMBER AND 3 DECEMBER 2009, AND
to decrease the interest rate on the main 14 JANUARY, 4 FEBRUARY, 4 MARCH, 8 APRIL AND
reﬁ nancing operations by 25 basis points to 6 MAY 2010
1.25%, starting from the operations to be settled
on 8 April 2009. In addition, it decides that The Governing Council of the ECB decides
the interest rates on the marginal lending and that the interest rate on the main reﬁ nancing
the deposit facility will be 2.25% and 0.25% operations and the interest rates on the marginal
respectively, with effect from 8 April 2009.
lending facility and the deposit facility will
remain unchanged at 1.00%, 1.75% and 0.25%
respectively.
7 MAY 2009
The Governing Council of the ECB decides to 10 MAY 2010
decrease the interest rate on the main reﬁ nancing
operations by 25 basis points to 1.00%, starting The Governing Council of the ECB decides on
from the operation to be settled on 13 May several measures to address severe tensions in
2009. In addition, it decides to decrease the ﬁ nancial markets. In particular, it decides to
interest rate on the marginal lending facility conduct interventions in the euro area public
by 50 basis points to 1.75% with effect from and private debt securities markets (Securities
13 May 2009, and to leave the interest rate Markets Programme).
ECB
Monthly Bulletin
July 2010
III

10 JUNE 2010
The Governing Council of the ECB decides
that the interest rate on the main reﬁ nancing
operations and the interest rates on the marginal
lending facility and the deposit facility will
remain unchanged at 1.00%, 1.75% and 0.25%
respectively. In addition, it decides to adopt a
ﬁ xed rate tender procedure with full allotment in
the regular three-month longer-term reﬁ nancing
operations to be allotted during the third quarter
of 2010.
8 JULY 2010
The Governing Council of the ECB decides
that the interest rate on the main reﬁ nancing
operations and the interest rates on the marginal
lending facility and the deposit facility will
remain unchanged at 1.00%, 1.75% and 0.25%
respectively.
ECB
Monthly Bulletin
IV
III
July 2010

DOCUMENTS PUBLISHED BY THE
EUROPEAN CENTRAL BANK SINCE 2009
This list is designed to inform readers about selected documents published by the European Central
Bank since January 2009. For Working Papers, which as of January 2009 (from Working Paper
No 989 onwards) are available online only, the list only refers to publications released between
April and June 2010. As of November 2009 (from Legal Working Paper No 9 onwards) Legal
Working Papers are also available online only. Unless otherwise indicated, hard copies can be
obtained or subscribed to free of charge, stock permitting, by contacting info@ecb.europa.eu.
For a complete list of documents published by the European Central Bank and by the European
Monetary Institute, please visit the ECB’s website (http://www.ecb.europa.eu).
ANNUAL REPORT
“Annual Report 2008”, April 2009.
“Annual Report 2009”, April 2010.
CONVERGENCE REPORT
“Convergence Report 2010”, May 2010.
MONTHLY BULLETIN ARTICLES
“Housing wealth and private consumption in the euro area”, January 2009.
“Foreign asset accumulation by authorities in emerging markets”, January 2009.
“New survey evidence on wage setting in Europe”, February 2009.
“Assessing global trends in protectionism”, February 2009.
“The external ﬁ nancing of households and non-ﬁ nancial corporations: a comparison of the euro
area and the United States”, April 2009.
“Revisions to GDP estimates in the euro area”, April 2009.
“The functional composition of government spending in the European Union”, April 2009.
“Expectations and the conduct of monetary policy”, May 2009.
“Five years of EU membership”, May 2009.
“Credit rating agencies: developments and policy issues”, May 2009.
“The impact of government support to the banking sector on euro area public ﬁ nances”, July 2009.
“The implementation of monetary policy since August 2007”, July 2009.
“Rotation of voting rights in the Governing Council of the ECB”, July 2009.
“Housing ﬁ nance in the euro area”, August 2009.
“Recent developments in the retail bank interest rate pass-through in the euro area”, August 2009.
“Monetary policy and loan supply in the euro area”, October 2009.
“Recent developments in the balance sheets of the Eurosystem, the Federal Reserve System and
the Bank of Japan”, October 2009.
“Financial development in emerging economies – stock-taking and policy implications”, October 2009.
“Central bank communication in periods of heightened uncertainty”, November 2009.
“Monetary analysis in an environment of ﬁ nancial turmoil”, November 2009.
“The latest euro area recession in a historical context”, November 2009.
“The ECB’s monetary policy stance during the ﬁ nancial crisis”, January 2010.
“The ECB’s relations with European Union institutions and bodies: trends and prospects”,
January 2010.
“Entitlements of households under government pension schemes in the euro area – results on the
basis of the new system of national accounts”, January 2010.
ECB
Monthly Bulletin
July 2010
V

“Euro repo markets and the ﬁ nancial market turmoil”, February 2010.
“Euro area commercial property markets and their impact on banks”, February 2010.
“Update on developments in general economic statistics for the euro area”, February 2010.
“Tools for preparing short-term projections of euro area inﬂ ation”, April 2010.
“Measures taken by euro area governments in support of the ﬁ nancial sector”, April 2010.
“Prospects for real and ﬁ nancial imbalances and a global rebalancing”, April 2010.
“Monetary policy transmission in the euro area, a decade after the introduction of the euro”, May 2010.
“The ‘Great Inﬂ ation’: lessons for monetary policy”, May 2010.
“Labour market adjustments to the recession in the euro area”, July 2010.
“The effectiveness of euro area ﬁ scal policies”, July 2010.
“The impact of the ﬁ nancial crisis on the central and eastern European countries”, July 2010.
STATISTICS POCKET BOOK
Available monthly since August 2003.
LEGAL WORKING PAPER SERIES
8
“National rescue measures in response to the current ﬁ nancial crisis” by A. Petrovic and
R. Tutsch, July 2009.
9
“The legal duty to consult the European Central Bank – national and EU consultations”
by S. E. Lambrinoc, November 2009.
10
“Withdrawal and expulsion from the EU and EMU: some reﬂ ections” by P. Athanassiou,
December 2009.
11
“The role of national central banks in banking supervision in selected central and
eastern European countries” by M. Apinis, M. Bodzioch, E. Csongrádi, T. Filipova,
Z. Foit, J. Kotkas, M. Porzycki and M. Vetrák, March 2010.
OCCASIONAL PAPER SERIES
100
“Survey
data on household ﬁ nance and consumption: research summary and policy use” by the
Eurosystem Household Finance and Consumption Network, January 2009.
101
“Housing
ﬁ nance in the euro area” by the Task Force of the Monetary Policy Committee of
the European System of Central Banks, March 2009.
102
“Domestic
ﬁ nancial development in emerging economies: evidence and implications”
by E. Dorrucci, A. Meyer-Cirkel and D. Santabárbara, April 2009.
103 “Transnational governance in global ﬁ nance: the principles for stable capital ﬂ ows and fair
debt restructuring in emerging markets” by R. Ritter, April 2009.
104 “Fiscal policy challenges in oil-exporting countries: a review of key issues” by M. Sturm,
F. Gurtner and J. González Alegre, June 2009.
105 “Flow-of-funds analysis at the ECB – framework and applications” by L. Bê Duc
and G. Le Breton, August 2009.
106 “Monetary policy strategy in a global environment” by P. Moutot and G. Vitale,
August 2009.
107 “The collateral frameworks of the Eurosystem, the Federal Reserve System and the Bank
of England and the ﬁ nancial market turmoil” by S. Cheun, I. von Köppen-Mertes and
B. Weller, December 2009.
108 “Trade consistency in the context of the Eurosystem projection exercises – an overview”
by K. Hubrich and T. Karlsson, March 2010.
ECB
Monthly Bulletin
VI July 2010

D O C U M E N T S
P U B L I S H E D
109 “Euro
area
ﬁ scal policies and the crisis” edited by A. van Riet, April 2010.
110 “Protectionist responses to the crisis: global trends and implications” by M. Bussière,
E. Pérez-Barreiro, R. Straub and D. Taglioni, April 2010.
111 “Main drivers of the ECB ﬁ nancial accounts and ECB ﬁ nancial strength over the ﬁ rst
11 years” by O. Vergote, W. Studener, I. Efthymiadis and N. Merriman, May 2010.
112 “Public wages in the euro area: towards securing stability and competitiveness”
by F. Holm-Hadulla, K. Kamath, A. Lamo, J. J. Pérez and L. Schuknecht, June 2010.
113 “Energy markets and the euro area macroeconomy” by Task Force of the Monetary Policy
Committee of the European System of Central Banks, June 2010.
114 “The impact of the global economic and ﬁ nancial crisis on central, eastern and south-eastern
Europe: a stock-taking exercise” by S. Gardó and R. Martin, June 2010.
RESEARCH BULLETIN
“Research Bulletin”, No 8, March 2009.
“Research Bulletin”, No 9, March 2010.
“Research Bulletin”, No 10, June 2010.
WORKING PAPER SERIES
1167 “Macroeconomic forecasting and structural change” by L. Gambetti, A. D’Agostino and
D. Giannone, April 2010.
1168 “Food price pass-through in the euro area: the role of asymmetries and non-linearities”
by R. Jiménez-Rodríguez, G. Ferrucci and L. Onorante, April 2010.
1169 “The impact of numerical expenditure rules on budgetary discipline over the cycle”
by F. Holm-Hadulla, S. Hauptmeier and P. Rother, April 2010.
1170 “Global commodity cycles and linkages: a FAVAR approach” by M. J. Lombardi, C. Osbat
and B. Schnatz, April 2010.
1171
“The external ﬁ nance premium in the euro area: a useful indicator for monetary policy?”
by P. Gelain, April 2010.
1172 “Size, openness and macroeconomic interdependence” by A. Chudik and R. Straub, April 2010.
1173 “Market power and ﬁ scal policy in OECD countries” by A. Afonso and L. F. Costa, April 2010.
1174 “How far are we from the slippery slope? The Laffer curve revisited” by M. Trabandt and
H. Uhlig, April 2010.
1175 “In dubio pro CES: supply estimation with mis-speciﬁ ed technical change”
by M. A. León-Ledesma, P. McAdam and A. Willman, April 2010.
1176 “Evolving Phillips trade-off” by L. Benati, April 2010.
1177 “Price and trading response to public information” by M. Malinowska, April 2010.
1178 “Monetary policy, housing booms and ﬁ nancial (im)balances” by S. Eickmeier and
B. Hofmann, April 2010.
1179 “Credit supply: identifying balance-sheet channels with loan applications and granted loans”
by G. Jiménez, S. Ongena, J.-L. Peydró and J. Saurina, April 2010.
1180 “Nominal and real wage rigidities. In theory and in Europe” by M. Knell, April 2010.
1181 “Wage setting and wage ﬂ exibility in Ireland: results from a ﬁ rm-level survey”
by M. Keeney and M. Lawless, April 2010.
1182 “Inter-industry wage differentials in EU countries: what do cross-country time varying data
add to the picture?” by P. Du Caju, G. Kátay, A. Lamo, D. Nicolitsas and S. Poelhekke,
April 2010.
ECB
Monthly Bulletin
July 2010
VII

1183 “Labour market institutions and the business cycle: unemployment rigidities vs. real wage
rigidities” by M. Abbritti and S. Weber, April 2010.
1184 “Costs, demand and producer price changes” by C. Loupias and P. Sevestre, April 2010.
1185 “Forecasting with DSGE models” by K. Christoffel, G. Coenen and A. Warne, May 2010.
1186
“Modelling anti-inﬂ ationary monetary targeting: with an application to Romania”
by M. Sánchez, May 2010.
1187 “Substitution between domestic and foreign currency loans in central Europe: do central
banks matter?” by M. Brzoza-Brzezina, T. Chmielewski and J. Niedźwiedzińska, May 2010.
1188 “Are policy counterfactuals based on structural VARs reliable?” by L. Benati, May 2010.
1189 “Maximum likelihood estimation of factor models on datasets with arbitrary pattern
of missing data” by M. Bańbura and M. Modugno, May 2010.
1190 “Booms and busts in China’s stock market: estimates based on fundamentals”
by G. J. de Bondt, T. A. Peltonen and D. Santabárbara, May 2010.
1191 “Money in monetary policy design: monetary cross-checking in the New Keynesian model”
by G. W. Beck and V. Wieland, May 2010.
1192 “Financial factors in economic ﬂ uctuations” by L. Christiano, R. Motto and M. Rostagno,
May 2010.
1193 “Should larger reserve holdings be more diversiﬁ ed?” by R. Beck and S. Weber, May 2010.
1194 “Econometric analysis of high dimensional VARs featuring a dominant unit”
by M. H. Pesaran and A. Chudik, May 2010.
1195 “The EAGLE: a model for policy analysis of macroeconomic interdependence in the
euro area” by S. Gomes, P. Jacquinot and M. Pisani, May 2010.
1196 “Reputational contagion and optimal regulatory forbearance” by A. D. Morrison
and L. White, May 2010.
1197 “Investors with too many options?” by D. Dorn, May 2010.
1198 “Wage and price-setting behaviour of Lithuanian ﬁ rms” by E. Virbickas, May 2010.
1199 “Changes in the wage structure in EU countries” by R. Christopoulou, J. F. Jimeno
and A. Lamo, May 2010.
1200 “Testing the asset pricing model of exchange rates with survey data” by A. Naszodi,
May 2010.
1201 “Growth strategies and value creation: what works best for stock exchanges?” by I. Hasan,
H. Schmiedel and L. Song, June 2010.
1202 “Involuntary unemployment and the business cycle” by L. Christiano, M. Trabandt
and K. Walentin, June 2010.
1203 “Cross-border banking and the international transmission of ﬁ nancial distress during the
crisis of 2007-08” by A. Popov and G. F. Udell, June 2010.
1204 “Banking sector output measurement in the euro area − a modiﬁ ed approach” by A. Colangelo
and R. Inklaar, June 2010.
1205
“Nelson-Siegel, afﬁ ne and quadratic yield curve speciﬁ cations: which one is better at
forecasting?” by K. Nyholm and R. Vidova-Koleva, June 2010.
1206 “Relative house price dynamics across euro area and US cities: convergence or
divergence?” by P. Hiebert and M. Roma, June 2010.
1207 “Money growth and inﬂ ation: a regime switching approach” by G. Amisano and G. Fagan,
June 2010.
1208 “Reverse causality in global current accounts” by G. Schnabl and S. Freitag, June 2010.
1209 “Epstein-Zin preferences and their use in macro-ﬁ nance models: implications for optimal
monetary policy” by M. Darracq Pariès and A. Loublier, June 2010.
1210 “Towards a robust monetary policy rule for the euro area” by T. Blattner and E. Margaritov,
June 2010.
ECB
Monthly Bulletin
VIII
July 2010

D O C U M E N T S
P U B L I S H E D
1211
“Efﬁ ciency and risk in European banking” by F. Fiordelisi, D. Marqués-Ibáñez,
and P. Molyneux, June 2010.
1212 “Multimarket trading and the cost of debt: evidence from global bonds” by L. Petrasek,
June 2010.
1213 “The incidence of nominal and real wage rigidity: an individual-based sectoral approach”
by J. Messina, M. Izquierdo, P. Du Caju, C. F. Duarte and N. Lynggård Hansen, June 2010.
1214 “Detecting and interpreting ﬁ nancial stress in the euro area” by M. Blix Grimaldi,
June 2010.
1215 “Formal education, mismatch and wages after transition: assessing the impact of unobserved
heterogeneity using matching estimators” by A. Lamo and J. Messina, June 2010.
1216 “What lies beneath the euro’s effect on ﬁ nancial integration? Currency risk, legal
harmonisation, or trade?” by S. Kalemli-Ozcan, E. Papaioannou, J.-L. Peydró, June 2010.
1217 “Fiscal policy and growth: do ﬁ nancial crises make a difference?” by C. Kolerus,
H. P. Grüner and A. Afonso, June 2010.
1218 “Sectoral money demand and the great disinﬂ ation in the United States” by A. Calza and
A. Zaghini, June 2010.
OTHER PUBLICATIONS
“Letter from the ECB President to Mr Robert Sturdy, Member of the European Parliament”,
January 2009 (online only).
“Euro money market study 2008”, February 2009 (online only).
“Eurosystem oversight policy framework”, February 2009 (online only).
“Harmonised oversight approach and oversight standards for payment instruments”, February 2009
(online only).
“European Commission’s consultation on hedge funds – Eurosystem contribution”, February 2009
(online only).
“Guiding principles for bank asset support schemes”, March 2009 (online only).
“Letter from the ECB President to Mr José Ribeiro e Castro, Member of the European
Parliament”, March 2009 (online only).
“Letter from the ECB President to Mr Dimitrios Papadimoulis, Member of the European
Parliament”, March 2009 (online only).
“Letter from the ECB President to Mr Manolis Mavrommatis, Member of the European Parliament,
regarding the issuance of low denomination euro banknotes”, March 2009 (online only).
“Letter from the ECB President to Mr Eoin Ryan, Member of the European Parliament, concerning the
recent widening of spreads between euro area government bond yields”, March 2009 (online only).
“Eurosystem’s SEPA expectations”, March 2009 (online only).
“Housing ﬁ nance in the euro area”, March 2009 (online only).
“Euro area monetary and ﬁ nancial statistics: 2008 quality report”, March 2009 (online only).
“Euro area balance of payments and international investment position statistics: 2008 quality report”,
March 2009 (online only).
“Manual on investment fund statistics”, May 2009 (online only).
“EU banks’ funding structures and policies”, May 2009 (online only).
“Letter from the ECB President to Mr Ashley Mote, Member of the European Parliament”,
May 2009 (online only).
“TARGET2 oversight assessment report”, May 2009 (online only).
“TARGET Annual Report”, May 2009 (online only).
“The ECB’s advisory role – overview of opinions (1994-2008)”, May 2009.
“Financial Stability Review”, June 2009.
ECB
Monthly Bulletin
July 2010
IX

“Recommendations for securities settlement systems and recommendations for central
counterparties in the European Union – European Central Bank (ECB) and the Committee of
European Securities Regulators (CESR)”, June 2009 (online only).
“The international role of the euro”, July 2009.
“Monthly report on the Eurosystem’s covered bond purchase programme – July 2009”, August 2009
(online only).
“Oversight framework for direct debit schemes”, August 2009 (online only).
“Oversight framework for credit transfer schemes”, August 2009 (online only).
“The Eurosystem’s stance on the Commission’s consultation document on the review of Directive
94/19/EC on deposit-guarantee schemes”, August 2009 (online only).
“Legal framework of the Eurosystem and the European System of Central Banks. ECB legal acts
and instruments. 2009 update”, August 2009.
“EU banking sector stability”, August 2009 (online only).
“Credit default swaps and counterparty risk”, August 2009 (online only).
“OTC derivatives and post-trading infrastructures”, September 2009 (online only).
“Monthly report on the Eurosystem’s covered bond purchase programme – August 2009”,
September 2009 (online only).
“Consultation of the European Commission on ‘Possible initiatives to enhance the resilience of
OTC derivatives markets’: Eurosystem contribution”, September 2009 (online only).
“ECB survey on access to ﬁ nance for small and medium-sized enterprises in the euro area”,
September 2009 (online only).
“The euro at ten – lessons and challenges”, Fifth ECB Central Banking Conference volume,
September 2009.
“Euro money market survey”, September 2009 (online only).
“Monthly report on the Eurosystem’s covered bond purchase programme – September 2009”,
October 2009 (online only).
“Letter from the ECB President to Mr Jim Higgins, Member of the European Parliament,
concerning consumer protection and banking practices in Spain”, October 2009 (online only).
“Letter from the ECB President to Mr Jim Higgins, Member of the European Parliament,
concerning the ECB’s considerations on issuing a €30 banknote”, October 2009 (online only).
“Monthly report on the Eurosystem’s covered bond purchase programme – October 2009”,
November 2009 (online only).
“Consultation of the Committee of European Securities Regulators on trade repositories in the
European Union – ECB contribution”, November 2009 (online only).
“Eurosystem oversight report 2009”, November 2009 (online only).
“Glossary of terms related to payment clearing and settlement systems”, December 2009 (online only).
“Monthly report on the Eurosystem’s covered bond purchase programme – November 2009”,
December 2009 (online only).
“New procedure for constructing Eurosystem and ECB staff projection ranges”, December 2009
(online only).
“Financial Stability Review”, December 2009.
“Retail payments – integration and innovation”, December 2009 (online only).
“Recent advances in modelling systemic risk using network analysis“, January 2010 (online only).
“Contribution of the Eurosystem to the public consultation of the European Commission on the
future ‘EU 2020’ strategy”, January 2010 (online only).
“Monthly report on the Eurosystem’s covered bond purchase programme – December 2009”,
January 2010 (online only).
“Structural indicators for the EU banking sector”, January 2010 (online only).
ECB
Monthly Bulletin
X
July 2010

D O C U M E N T S
P U B L I S H E D
“Correspondent central banking model (CCBM) – procedure for Eurosystem counterparties”,
January 2010 (online only).
“Letter from the ECB President to Mr Nuno Melo, Member of the European Parliament, concerning
the increase in the capital of Banco Português de Negócios (BPN)”, February 2010 (online only).
“The ‘Centralised Securities Database’ in brief”, February 2010 (online only).
“Monthly report on the Eurosystem’s covered bond purchase programme – January 2010”,
February 2010 (online only).
“Commission communication on ‘An EU framework for cross-border crisis management in the
banking sector’: Eurosystem’s reply to the public consultation”, February 2010 (online only).
“Survey on the access to ﬁ nance of small and medium-sized enterprises in the euro area – second
half of 2009”, February 2010 (online only).
“MFI balance sheet and interest rate statistics and CEBS’ guidelines on FINREP and COREP”,
February 2010 (online only).
“Letter from the ECB President to Mr Nikolaos Chountis, Member of the European Parliament,
related to the income of Mr Provopoulos, Governor of the Bank of Greece”, February 2010
(online only).
“ECB-Eurostat workshop on pensions”, February 2010 (online only).
“Monthly report on the Eurosystem’s covered bond purchase programme – February 2010”,
March 2010 (online only).
“Letter from the ECB President to Mr Diogo Feio, Member of the European Parliament, regarding
the economic situation in Portugal”, March 2010 (online only).
“Strengthening macro and micro-prudential supervision in EU candidates and potential
candidates”, March 2010 (online only).
“Letter from the ECB President to Mr Nuno Melo, Member of the European Parliament,
concerning the increase in the capital of Banco Português de Negócios (BPN)”, March 2010
(online only).
“Government ﬁ nance statistics guide”, March 2010 (online only).
“Letter from the ECB President to Mr Nikolaos Chountis, Member of the European Parliament,
regarding credit rating agencies”, March 2010 (online only).
“Euro area balance of payments and international investment position statistics – 2009 quality
report”, March 2010 (online only).
“Euro area monetary and ﬁ nancial statistics – 2009 quality report”, March 2010 (online only).
“Monthly report on the Eurosystem’s covered bond purchase programme – March 2010”, April 2010
(online only).
“Financial integration in Europe”, April 2010.
“Report on the lessons learned from the ﬁ nancial crisis with regard to the functioning of European
ﬁ nancial market infrastructures”, April 2010 (online only).
“Results of the public consultation on ABS loan-level information in the Eurosystem collateral
framework”, April 2010 (online only).
“ECB statistics – an overview”, April 2010 (online only).
“European statistics provided by the ESCB – the governance structure”, April 2010 (online only).
“Memorandum of understanding on the exchange of information among national central credit
registers for the purpose of passing it on to reporting institutions”, April 2010 (online only).
“Monthly report on the Eurosystem’s covered bond purchase programme – April 2010”,
May 2010 (online only).
“TARGET Annual Report 2009”, May 2010 (online only).
“Letter from the ECB President to Mr Paulo Rangel, Member of the European Parliament,
regarding structural reforms”, May 2010.
“Financial Stability Review”, June 2010.
ECB
Monthly Bulletin
July 2010
XI

“Structural Issues Report 2010 − Energy markets and the euro area macroeconomy”, June 2010
(online only).
“Monthly report on the Eurosystem’s covered bond purchase programme – May 2010”, June 2010
(online only).
“Reinforcing economic governance in the euro area – The ECB Governing Council’s proposals to
strengthen decisively governance and enforcement structures in the economic policy framework of
the euro area”, June 2010 (online only).
“Letter from the ECB President to the President of the European Council, Mr Herman Van
Rompuy, presenting the ECB Governing Council’s proposals for reinforcing economic governance
in the euro area”, June 2010 (online only).
“Letter from the ECB President to Mr Andreas Mölzer, Member of the European Parliament,
regarding questions related to the governance of the euro area”, June 2010 (online only).
INFORMATION BROCHURES
“The European Central Bank, the Eurosystem, the European System of Central Banks”,
April 2009.
“Price stability – why is it important for you?”, April 2009.
“The Single Euro Payments Area (SEPA): an integrated retail payments market”, July 2009.
“T2S – settling without borders”, January 2010.
“ECB statistics: a brief overview”, April 2010.
ECB
Monthly Bulletin
XII
July 2010

GLOSSARY
This glossary contains selected items that are frequently used in the Monthly Bulletin. A more
comprehensive and detailed glossary can be found on the ECB’s website (www.ecb.europa.eu/
home/glossary/html/index.en.html).
Autonomous liquidity factors: liquidity factors that do not normally stem from the use of monetary
policy instruments. Such factors are, for example, banknotes in circulation, government deposits
with the central bank and the net foreign assets of the central bank.
Balance of payments (b.o.p.): a statistical statement that summarises, for a speciﬁ c period of
time, the economic transactions of an economy with the rest of the world.
Bank lending survey (BLS): a quarterly survey on lending policies that has been conducted by
the Eurosystem since January 2003. It addresses qualitative questions on developments in credit
standards, terms and conditions of loans and loan demand for both enterprises and households to a
predeﬁ ned sample group of banks in the euro area.
Borrowing requirement (general government): net incurrence of debt by the general government.
Break-even inflation rate: the spread between the yield on a nominal bond and that on an inﬂ ation-
linked bond of the same (or as similar as possible) maturity.
Capital account: a b.o.p. account that covers all capital transfers and acquisitions/disposals of
non-produced, non-ﬁ nancial assets between residents and non-residents.
Capital accounts: part of the system of national (or euro area) accounts consisting of the change in
net worth that is due to net saving, net capital transfers and net acquisitions of non-ﬁ nancial assets.
Central parity (or central rate): the exchange rate of each ERM II member currency vis-à-vis the
euro, around which the ERM II ﬂ uctuation margins are deﬁ ned.
Compensation per employee or per hour worked: the total remuneration, in cash or in kind, that
is payable by employers to employees, i.e. gross wages and salaries, as well as bonuses, overtime
payments and employers’ social security contributions, divided by the total number of employees
or by the total number of employees’ hours worked.
Consolidated balance sheet of the MFI sector: a balance sheet obtained by netting out inter-
MFI positions (e.g. inter-MFI loans and deposits) in the aggregated MFI balance sheet. It provides
statistical information on the MFI sector’s assets and liabilities vis-à-vis residents of the euro area
not belonging to this sector (i.e. the general government and other euro area residents) and vis-à-vis
non-euro area residents. It is the main statistical source for the calculation of monetary aggregates,
and it provides the basis for the regular analysis of the counterparts of M3.
Current account: a b.o.p. account that covers all transactions in goods and services, income and
current transfers between residents and non-residents.
Debt (financial accounts): loans taken out by households, as well as the loans, debt securities
and pension fund reserves (resulting from employers’ direct pension commitments on behalf
of their employees) of non-ﬁ nancial corporations, valued at market prices at the end of the period.
ECB
Monthly Bulletin
July 2010
XIII

Debt (general government): the gross debt (currency and deposits, loans and debt securities)
at nominal value outstanding at the end of the year and consolidated between and within the sectors
of general government.
Debt security: a promise on the part of the issuer (i.e. the borrower) to make one or more
payment(s) to the holder (the lender) on a speciﬁ ed future date or dates. Such securities usually
carry a speciﬁ c rate of interest (the coupon) and/or are sold at a discount to the amount that will
be repaid at maturity. Debt securities issued with an original maturity of more than one year are
classiﬁ ed as long-term.
Debt-to-GDP ratio (general government): the ratio of general government debt to GDP at
current market prices. It is the subject of one of the ﬁ scal criteria laid down in Article 126(2) of the
Treaty on the Functioning of the European Union to deﬁ ne the existence of an excessive deﬁ cit.
Deficit (general government): the general government’s net borrowing, i.e. the difference between
total government revenue and total government expenditure.
Deficit-debt adjustment (general government): the difference between the general government
deﬁ cit and the change in general government debt.
Deficit ratio (general government): the ratio of the general government deﬁ cit to GDP at current
market prices. It is the subject of one of the ﬁ scal criteria laid down in Article 126(2) of the Treaty
on the Functioning of the European Union to deﬁ ne the existence of an excessive deﬁ cit. It is also
referred to as the budget deﬁ cit ratio or the ﬁ scal deﬁ cit ratio.
Deflation: a generalised, persistent and self-reinforcing decline in a broad set of prices that results
from a drop in aggregate demand and becomes entrenched in expectations.
Deposit facility: a standing facility of the Eurosystem which counterparties may use to make
overnight deposits, remunerated at a pre-speciﬁ ed interest rate, at an NCB.
Disinflation: a process of decelerating inﬂ ation that may lead to negative inﬂ ation rates of
a temporary nature.
Direct investment: cross-border investment for the purpose of obtaining a lasting interest in an
enterprise resident in another economy (assumed, in practice, for ownership of at least 10% of the
ordinary shares or voting power). Included are equity capital, reinvested earnings and other capital
associated with inter-company operations. The direct investment account records net transactions/
positions in assets abroad by euro area residents (as “direct investment abroad”) and net transactions/
positions in euro area assets by non-residents (as “direct investment in the euro area”).
Effective exchange rates (EERs) of the euro (nominal/real): weighted averages of bilateral
euro exchange rates against the currencies of the euro area’s main trading partners. The EER indices
of the euro are calculated against two groups of trading partners: the EER-21 (comprising the
11 non-euro area EU Member States and 10 trading partners outside the EU) and the EER-41
(composed of the EER-21 and 20 additional countries). The weights used reﬂ ect the share of each
partner country in the euro area’s trade in manufactured goods and account for competition in
third markets. Real EERs are nominal EERs deﬂ ated by a weighted average of foreign, relative to
domestic, prices or costs. They are thus measures of price and cost competitiveness.
ECB
Monthly Bulletin
XIV July 2010

G L O S S A R Y
Enhanced credit support: the non-standard measures taken by the ECB/Eurosystem during the
ﬁ nancial crisis with a view to supporting ﬁ nancing conditions and credit ﬂ ows above and beyond
what could be achieved through reductions in key ECB interest rates alone.
EONIA (euro overnight index average): a measure of the effective interest rate prevailing in the
euro interbank overnight market. It is calculated as a weighted average of the interest rates on unsecured
overnight lending transactions denominated in euro, as reported by a panel of contributing banks.
Equities: securities representing ownership of a stake in a corporation. They comprise shares traded
on stock exchanges (quoted shares), unquoted shares and other forms of equity. Equities usually
produce income in the form of dividends.
ERM II (exchange rate mechanism II): the exchange rate arrangement that provides the
framework for exchange rate policy cooperation between the euro area countries and the
EU Member States not participating in Stage Three of EMU.
EURIBOR (euro interbank offered rate): the rate at which a prime bank is willing to lend funds
in euro to another prime bank, computed daily for interbank deposits with different maturities of up
to 12 months.
Euro area: the area formed by those EU Member States in which the euro has been adopted as the
single currency in accordance with the Treaty on the Functioning of the European Union.
European Commission surveys: harmonised surveys of business and/or consumer sentiment
conducted on behalf of the European Commission in each of the EU Member States. Such
questionnaire-based surveys are addressed to managers in the manufacturing, construction, retail
and services industries, as well as to consumers. From each monthly survey, composite indicators
are calculated that summarise the replies to a number of different questions in a single indicator
(conﬁ dence indicators).
Eurosystem: the central banking system made up of the ECB and the NCBs of those EU Member
States that have already adopted the euro.
Eurozone Purchasing Managers’ Surveys: surveys of business conditions in manufacturing and
in services industries conducted for a number of countries in the euro area and used to compile
indices. The Eurozone Manufacturing Purchasing Managers’ Index (PMI) is a weighted indicator
calculated from indices of output, new orders, employment, suppliers’ delivery times and stocks
of purchases. The services sector survey asks questions on business activity, expectations of future
business activity, the amount of business outstanding, incoming new business, employment, input
prices and prices charged. The Eurozone Composite Index is calculated by combining the results
from the manufacturing and services sector surveys.
External trade in goods: exports and imports of goods with countries outside the euro area,
measured in terms of value and as indices of volume and unit value. External trade statistics are
not comparable with the exports and imports recorded in the national accounts, as the latter include
both intra-euro area and extra-euro area transactions, and also combine goods and services. Nor are
they fully comparable with the goods item in b.o.p. statistics. Besides methodological adjustments,
the main difference is that imports in external trade statistics are recorded including insurance and
freight services, whereas they are recorded free on board in the goods item in the b.o.p. statistics.
ECB
Monthly Bulletin
July 2010
XV

Financial account: a b.o.p. account that covers transactions between residents and non-residents in
direct investment, portfolio investment, other investment, ﬁ nancial derivatives and reserve assets.
Financial accounts: part of the system of national (or euro area) accounts showing the ﬁ nancial
positions (stocks or balance sheets), ﬁ nancial transactions and other changes of the different
institutional sectors of an economy by type of ﬁ nancial asset.
Fixed rate tender: a tender procedure in which the interest rate is speciﬁ ed in advance by the
central bank and in which participating counterparties bid the amount of money they wish to
transact at the ﬁ xed interest rate.
Fixed rate full-allotment tender procedure: a tender procedure in which the interest rate is
speciﬁ ed by the central bank and in which counterparties bid the amount of money they want to
transact at that rate, knowing in advance that all their bids will be satisﬁ ed.
General government: a sector deﬁ ned in the ESA 95 as comprising resident entities that are
engaged primarily in the production of non-market goods and services intended for individual and
collective consumption and/or in the redistribution of national income and wealth. Included are
central, regional and local government authorities as well as social security funds. Excluded are
government-owned entities that conduct commercial operations, such as public enterprises.
Gross domestic product (GDP): the value of an economy’s total output of goods and services less
intermediate consumption, plus net taxes on products and imports. GDP can be broken down by
output, expenditure or income components. The main expenditure aggregates that make up GDP are
household ﬁ nal consumption, government ﬁ nal consumption, gross ﬁ xed capital formation, changes
in inventories, and imports and exports of goods and services (including intra-euro area trade).
Harmonised Index of Consumer Prices (HICP): a measure of the development of consumer
prices that is compiled by Eurostat and harmonised for all EU Member States.
Hourly labour cost index: a measure of labour costs, including gross wages and salaries
(in cash and in kind, including bonuses) and other labour costs (employers’ social contributions
plus employment-related taxes paid by the employer minus subsidies received by the employer),
per hour actually worked (including overtime).
Implied volatility: the expected volatility (i.e. standard deviation) in the rates of change of the
price of an asset (e.g. a share or a bond). It can be derived from the asset’s price, maturity date and
exercise price of its options, as well as from a riskless rate of return, using an option pricing model
such as the Black-Scholes model.
Index of negotiated wages: a measure of the direct outcome of collective bargaining in terms of
basic pay (i.e. excluding bonuses) at the euro area level. It refers to the implied average change in
monthly wages and salaries.
Industrial producer prices: factory-gate prices (transportation costs are not included) of all
products sold by industry excluding construction on the domestic markets of the euro area countries,
excluding imports.
Industrial production: the gross value added created by industry at constant prices.
ECB
Monthly Bulletin
XVI July 2010

G L O S S A R Y
Inflation: an increase in the general price level, e.g. in the consumer price index.
Inflation-indexed government bonds: debt securities issued by the general government, the
coupon payments and principal of which are linked to a speciﬁ c consumer price index.
International investment position (i.i.p.): the value and composition of an economy’s outstanding
net ﬁ nancial claims on (or ﬁ nancial liabilities to) the rest of the world.
International reserves: external assets readily available to and controlled by monetary authorities
for directly ﬁ nancing or regulating the magnitude of payments imbalances through intervention
in exchange markets. The international reserves of the euro area comprise non-euro denominated
claims on non-euro area residents, gold, special drawing rights and the reserve positions in the IMF
which are held by the Eurosystem.
Investment funds (except money market funds): ﬁ nancial institutions that pool capital raised
from the public and invest it in ﬁ nancial and non-ﬁ nancial assets. See also MFIs.
Job vacancies: a collective term covering newly created jobs, unoccupied jobs or jobs about to
become vacant in the near future, for which the employer has recently taken active steps to ﬁ nd a
suitable candidate.
Key ECB interest rates: the interest rates, set by the Governing Council, which reﬂ ect the
monetary policy stance of the ECB. They are the rates at the main reﬁ nancing operations, on the
marginal lending facility and on the deposit facility.
Labour force: the sum total of persons in employment and the number of unemployed.
Labour productivity: the output that can be produced with a given input of labour. It can be
measured in several ways, but is commonly measured as GDP (volume) divided by either total
employment or total hours worked.
Longer-term refinancing operations: credit operations with a maturity of more than one week that
are executed by the Eurosystem in the form of reverse transactions. The regular monthly operations
are conducted with a maturity of three months. During the ﬁ nancial market turmoil that started in
August 2007, supplementary operations with maturities ranging from one maintenance period to
one year were conducted, the frequency of which varied.
M1: a narrow monetary aggregate that comprises currency in circulation plus overnight deposits
held with MFIs and central government (e.g. at the post ofﬁ ce or treasury).
M2: an intermediate monetary aggregate that comprises M1 plus deposits redeemable at a period
of notice of up to and including three months (i.e. short-term savings deposits) and deposits with an
agreed maturity of up to and including two years (i.e. short-term time deposits) held with MFIs and
central government.
M3: a broad monetary aggregate that comprises M2 plus marketable instruments, in particular
repurchase agreements, money market fund shares and units, and debt securities with a maturity of
up to and including two years issued by MFIs.
ECB
Monthly Bulletin
July 2010
XVII

Main refinancing operation: a regular open market operation executed by the Eurosystem in the
form of reverse transactions. Such operations are carried out through a weekly standard tender and
normally have a maturity of one week.
Marginal lending facility: a standing facility of the Eurosystem which counterparties may use to
receive overnight credit from an NCB at a pre-speciﬁ ed interest rate against eligible assets.
MFI credit to euro area residents: MFI loans granted to non-MFI euro area residents (including
general government and the private sector) and MFI holdings of securities (shares, other equity and
debt securities) issued by non-MFI euro area residents.
MFI interest rates: the interest rates that are applied by resident credit institutions and other MFIs,
excluding central banks and money market funds, to euro-denominated deposits and loans vis-à-vis
households and non-ﬁ nancial corporations resident in the euro area.
MFI longer-term financial liabilities: deposits with an agreed maturity of over two years,
deposits redeemable at a period of notice of over three months, debt securities issued by euro area
MFIs with an original maturity of more than two years and the capital and reserves of the euro area
MFI sector.
MFI net external assets: the external assets of the euro area MFI sector (such as gold, foreign
currency banknotes and coins, securities issued by non-euro area residents and loans granted to
non-euro area residents) minus the external liabilities of the euro area MFI sector (such as non-euro
area residents’ deposits and repurchase agreements, as well as their holdings of money market fund
shares/units and debt securities issued by MFIs with a maturity of up to and including two years).
MFIs (monetary financial institutions): ﬁ nancial institutions which together form the money-
issuing sector of the euro area. These include the Eurosystem, resident credit institutions (as deﬁ ned
in Community law) and all other resident ﬁ nancial institutions whose business is to receive deposits
and/or close substitutes for deposits from entities other than MFIs and, for their own account
(at least in economic terms), to grant credit and/or invest in securities. The latter group consists
predominantly of money market funds, i.e. funds that invest in short-term and low-risk instruments
usually with a maturity of one year or less.
Minimum bid rate: the lower limit to the interest rates at which counterparties may submit bids in
the variable tenders.
Other investment: an item in the b.o.p. and the i.i.p. that covers the ﬁ nancial transactions/positions
with non-residents in trade credits, deposits and loans, and other accounts receivable and payable.
Portfolio investment: euro area residents’ net transactions and/or positions in securities issued
by non-residents of the euro area (“assets”) and non-residents’ net transactions and/or positions in
securities issued by euro area residents (“liabilities”). Included are equity securities and debt securities
(bonds and notes, and money market instruments). Transactions are recorded at the effective price
paid or received, less commissions and expenses. To be regarded as a portfolio asset, ownership in
an enterprise must be equivalent to less than 10% of the ordinary shares or voting power.
Price stability: the maintenance of price stability is the primary objective of the Eurosystem. The
Governing Council deﬁ nes price stability as a year-on-year increase in the HICP for the euro area
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Monthly Bulletin
XVIII
July 2010

G L O S S A R Y
of below 2%. The Governing Council has also made it clear that, in the pursuit of price stability,
it aims to maintain inﬂ ation rates below, but close to, 2% over the medium term.
Purchasing power parity (PPP): the rate at which one currency is converted into another so as
to equalise the purchasing power of the two currencies by eliminating the differences in the price
levels prevailing in the countries concerned. In their simplest form, PPPs show the ratio of the
prices in national currency of the same good or service in different countries.
Reference value for M3 growth: the annual growth rate of M3 over the medium term that is
consistent with the maintenance of price stability. At present, the reference value for annual M3
growth is 4½%.
Reserve requirement: the minimum amount of reserves a credit institution is required to hold
with the Eurosystem over a predeﬁ ned maintenance period. Compliance with the requirement
is determined on the basis of the average of the daily balances in the reserve accounts over the
maintenance period.
Survey of Professional Forecasters (SPF): a quarterly survey that has been conducted by the
ECB since 1999 to collect macroeconomic forecasts on euro area inﬂ ation, real GDP growth and
unemployment from a panel of experts afﬁ liated to ﬁ nancial and non-ﬁ nancial organisations based
in the EU.
Unit labour costs: a measure of total labour costs per unit of output calculated for the euro area as
the ratio of total compensation per employee to labour productivity (deﬁ ned as GDP (volume) per
person employed).
Variable rate tender: a tender procedure where the counterparties bid both the amount of money
they wish to transact with the central bank and the interest rate at which they wish to enter into the
transaction.
Volatility: the degree of ﬂ uctuation in a given variable.
Write-down: a downward adjustment to the value of loans recorded in the balance sheets of MFIs
when it is recognised that the loans have become partly unrecoverable.
Write-off: the removal of the value of loans from the balance sheets of MFIs when the loans are
considered to be totally unrecoverable.
Yield curve: a graphical representation of the relationship between the interest rate or yield and the
residual maturity at a given point in time for sufﬁ ciently homogenous debt securities with different
maturity dates. The slope of the yield curve can be measured as the difference between the interest
rates or yield at two selected maturities.
ECB
Monthly Bulletin
July 2010
XIX