Monetary developments in the euro area: December 2024

Components of the broad monetary aggregate M3

The annual growth rate of the broad monetary aggregate M3 decreased to 3.5% in December 2024 from 3.8% in November, averaging 3.6% in the three months up to December. The components of M3 showed the following developments. The annual growth rate of the narrower aggregate M1, which comprises currency in circulation and overnight deposits, increased to 1.8% in December from 1.5% in November. The annual growth rate of short-term deposits other than overnight deposits (M2-M1) decreased to 4.5% in December from 6.1% in November. The annual growth rate of marketable instruments (M3-M2) decreased to 16.3% in December from 17.0% in November.

Looking at the components' contributions to the annual growth rate of M3, the narrower aggregate M1 contributed 1.1 percentage points (up from 1.0 percentage points in November), short-term deposits other than overnight deposits (M2-M1) contributed 1.3 percentage points (down from 1.8 percentage points) and marketable instruments (M3-M2) contributed 1.0 percentage points (as in the previous month).

Among the holding sectors of deposits in M3, the annual growth rate of deposits placed by households stood at 3.5% in December, unchanged from the previous month, while the annual growth rate of deposits placed by non-financial corporations increased to 2.9% in December from 2.3% in November.

Finally, the annual growth rate of deposits placed by investment funds other than money market funds
decreased to 7.4% in December from 7.9% in November.