Lending rates to households continue upwards

Most of the interest rates, those with floating rates and those with shorter duration continue to rise. However, the opposite holds true for loans with longer duration than five years; the rates for these loans continue to follow the slight drop in the trend which began in July this year. At the end of October, the lending rate on new loans with a duration of more than five years was 5.26 percent, compared to 5.27 in September and 5.32 in July 2007.

Lending to households

The annual growth rate for MFIs' loans to households was the same in October 2007 as in the previous month, or 11.7 percent. Total lending of MFIs to Swedish households amounted to SEK 1 926 billion in October. SEK 131 billion comprised loans for consumption and SEK 1 236 billion for housing. The annual growth rate for households' consumption credit from MFIs amounted to 13.8 percent, compared to 13.5 percent the month before and 13.6 percent in January 2007. The corresponding rates for housing loans to households was 11.8 percent in October compared to 11.7 percent in September and 13.2 percent in January.

Lending from housing credit institutions to households

The current trend that over half of the borrowers choose fixed interest rates still stands. In October 57 percent of households took out new loans at fixed rates from housing credit institutions. Of these, 67 percent had a fixed interest period of less than five years.
 

Growth rate in money supply

The annual growth rate for the broad money supply measure M3 continued to increase from 16.3 percent in September to 19.7 percent in October 2007. As has been the case in the most recent previous months, this is because the volume of outstanding mutual funds held by the Swedish public also continued to increase in October. The volume for M3 amounted to SEK 2 054 billion in October. However, the growth rate for M1 continued to drop. During the period September to October, M1 fell from 9.5 percent in September to 8.4 percent in October 2007. In total, M1 amounted to SEK 1 278 billion in September.

The money supply measure M1 consists of notes, coins and current accounts (for example salary-linked bank accounts and other accounts in which money can in principle be withdrawn immediately). M3 consists of the components in M1 plus deposits with conditions, real repurchasing transactions (repo rates), shares in money market funds and securities with a duration of up to two years.