Reduced growth rate for loans to households

The annual growth rate for household consumption credit from MFIs fell and amounted to 11.0 percent in December, compared to 13.7 percent the month before. Compared to December 2006, when the annual growth rate of household consumption credits amounted to 14.5 percent, the rate has dropped by more than 3.5 percentage points. The annual growth rate on loans for households' housing has also dropped since November when it was 12.0 percent to 11.1 percent in December.

Growth of M3 dropping

After several months of a decline, annual growth increased for the narrow money supply measure M1 from 7.4 percent in November to 8.3 percent in December 2007. Development for the wider measure M3 went in the opposite direction and growth dropped from 20.8 percent in November to 18.4 percent in December, which is still a high growth rate. This is the first time since July that the growth rate of M3 has decreased. The decline is mainly due to a drop in the general public's holdings of securities issued by monetary finance institutes (MFI) with a duration of up to two years. M1 amounted to SEK 1 320 billion in December, compared to SEK 1 275 in November. M3 amounted in SEK 2 097 billion in December.

M1 consists of the public's holding of banknotes and coins as well as demand deposits by the public in MFIs and with the central government. In addition to M1, M3 includes deposits with certain terms, repo transactions, shares in money market funds and short-term securities.
 

Lending rates to households

MFIs' average lending rate in December for new contracts to households was 5.16 percent, compared to 5.14 percent the month before. Interest on loans with a fixation period up to one year continues to rise, while interest on loans with longer terms fell. Interest on loans with longer duration than five years was 5.23 percent in December, a drop of 0.07 percent compared to the previous month.

The average interest on new loans from housing credit institutions was 5.07 percent in December, or 0.09 percentage points higher than in November. Compared to December 2006 when the interest rate was 4.04 percent, interest has increased by over one percentage point by the end of 2007. Interest with floating rates of up to 3 months has in the last month risen from 4.80 to 4.93 percent in December. This is 1.24 percentage points more than in December 2006. However, long-term interest of over 5 years has had a more subdued growth. During the last year, long-term interest has fluctuated from 4.64 percent to 5.34 percent in December, which is unchanged from November.