Category: 3. Business

25 July 2025

Components of the broad monetary aggregate M3

The annual growth rate of the broad monetary aggregate M3 decreased to 3.3% in June 2025 from 3.9% in May, averaging 3.7% in the three months up to June. 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, decreased to 4.6% in June from 5.1% in May. The annual growth rate of short-term deposits other than overnight deposits (M2-M1) was -1.1% in June, compared with -0.1% in May. The annual growth rate of marketable instruments (M3-M2) decreased to 10.4% in June from 11.5% in May.

Data for monetary aggregates

Looking at the components’ contributions to the annual growth rate of M3, the narrower aggregate M1 contributed 2.9 percentage points (down from 3.2 percentage points in May), short-term deposits other than overnight deposits (M2-M1) contributed -0.3 percentage points (down from 0.0 percentage points) and marketable instruments (M3-M2) contributed 0.7 percentage points (down from 0.8 percentage points).

Among the holding sectors of deposits in M3, the annual growth rate of deposits placed by households decreased to 3.3% in June from 3.5% in May, while the annual growth rate of deposits placed by non-financial corporations decreased to 1.5% in June from 2.7% in May. Finally, the annual growth rate of deposits placed by investment funds other than money market funds decreased to 13.1% in June from 15.4% in May.

Counterparts of the broad monetary aggregate M3

The annual growth rate of M3 in June 2025, as a reflection of changes in the items on the monetary financial institution (MFI) consolidated balance sheet other than M3 (counterparts of M3), can be broken down as follows: claims on the private sector contributed 2.6 percentage points (up from 2.4 percentage points in May), net external assets contributed 2.4 percentage points (down from 2.5 percentage points), claims on general government contributed 0.0 percentage points (down from 0.2 percentage points), longer-term liabilities contributed -1.1 percentage points (as in the previous month), and the remaining counterparts of M3 contributed -0.6 percentage points (down from -0.1 percentage points).

Data for contribution of the M3 counterparts to the annual growth rate of M3

Claims on euro area residents

The annual growth rate of total claims on euro area residents stood at 2.0% in June 2025, compared with 1.9% in the previous month. The annual growth rate of claims on general government decreased to 0.1% in June from 0.6% in May, while the annual growth rate of claims on the private sector increased to 2.7% in June from 2.5% in May.

The annual growth rate of adjusted loans to the private sector (i.e. adjusted for loan transfers and notional cash pooling) increased to 3.0% in June from 2.8% in May. Among the borrowing sectors, the annual growth rate of adjusted loans to households increased to 2.2% in June from 2.0% in May, while the annual growth rate of adjusted loans to non-financial corporations increased to 2.7% in June from 2.5% in May.

Data for adjusted loans to the private sector

Notes:

• Data in this press release are adjusted for seasonal and end-of-month calendar effects, unless stated otherwise.
• “Private sector” refers to euro area non-MFIs excluding general government.
• Hyperlinks lead to data that may change with subsequent releases as a result of revisions. Figures shown in annex tables are a snapshot of the data as at the time of the current release.

There’s little reason for the European Central Bank to lower interest rates further unless the economy suffers a major blow, according to Governing Council member Martins Kazaks.

With inflation at 2% and the euro zone largely performing in line with the ECB’s latest forecasts, the grounds for a cut in September — as expected by a majority of economists before this week’s meeting — aren’t obvious, the Latvian central-bank chief said.

Starlink, the world’s most widely used satellite internet service, experienced a rare global outage that affected thousands of users across North America, Europe, Asia, and Australia. The outage began late Wednesday night 11:00 PM GMT (4:30 AM IST) and lasted approximately two and a half hours. Users reported sudden loss of connectivity, slow speeds, and unresponsive terminals. Elon Musk, CEO of SpaceX, addressed the issue several hours later on X (formerly Twitter), attributing the outage to a configuration error during a routine software update. Although service has since been restored, the incident raises concerns about the resilience of satellite-based internet systems amid increasing reliance on them for communication, navigation, and defense.

What caused Starlink’s Global outage

According to statements from SpaceX engineers, the outage was caused by a failure in key internal software services that operate the core Starlink network. The error occurred during a routine software update intended to improve inter-satellite communication performance and latency. However, this update introduced a critical misconfiguration that disrupted how satellites relay data to one another. As a result, communication links between satellites degraded and many ground terminals lost connection to the broader internet. Elon Musk described the incident as a “cascading failure triggered by a single node update” and called the situation embarrassing but fixable. Starlink’s Vice President of Engineering, Michael Nicolls, confirmed the cause on X and apologized for the disruption.

Who was affected by the Starlink outage

The outage was widespread, impacting both civilian and commercial users. Airlines relying on Starlink for in-flight Wi-Fi, rural communities in North America, military installations, remote research stations, maritime users, and RV owners all experienced connectivity interruptions. The outage monitoring website Downdetector logged over 60,000 user complaints globally at the peak of the disruption.

SpaceX response to the Global service disruption

SpaceX engineers identified the problem and issued an emergency patch within about three hours. Elon Musk publicly apologized on X, stating, “Apologies for the inconvenience. A software update went wrong, but we’ve fixed it.” Service restoration began around 21:31 UTC, and normal functionality was largely recovered by 21:40 UTC on July 24, 2025.

What are the risk of recurrence

While Starlink’s service has proven reliable in the past, particularly in conflict zones like Ukraine, experts acknowledge that its reliance on centralized control and automated software updates introduces vulnerabilities to software bugs. SpaceX has announced plans to implement multi-layer rollback mechanisms and more rigorous testing protocols to minimize the risk of similar events in the future.

Growing importance of Starlink

Starlink now serves over 6 million users across 140 countries, offering critical connectivity to underserved regions. Its network supports government agencies, airlines, shipping companies, and military operations. Any disruption, even short-lived, highlights the global significance of satellite internet infrastructure in an increasingly connected world.

(Bloomberg) — The rally in Japanese stocks has pushed some market indicators close to levels struck ahead of last year’s meltdown, after a US trade deal propelled equities to a record.

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“When the market starts rising this quickly, I do think we need to be cautious with what happened in August in mind,” said Hisashi Arakawa, director and the head of equities at abrdn Japan Ltd. “This time around, it’s not the yen driving the rally but I’m definitely keeping a close eye on the levels we saw during last summer.”

Japanese stocks crashed last August in the wake of the Bank of Japan’s (8301.T) unexpected interest rate hike, coupled with Governor Kazuo Ueda’s hawkish messaging and economic concerns in the US. The central bank has since managed to raise its policy rate without triggering a repeat of that rout, and the macro environment has shifted, with US tariff policies the main driver of the market.

Still, some technical indicators show Japanese equities are now looking vulnerable like they did just before last year’s selloff, when the Topix index was trading at record highs.

The Topix’s 14-day relative-strength-index was about 79 on Thursday, above the threshold that signals the market may be in overbought territory. The benchmark was in that range last July, less than a month before the selloff.

The Topix index traded more than 5% above its 25-day moving average on Thursday, a level has traditionally preceded a correction, according to Rakuten Securities Inc. Recently in September 2021 and March 2022, the divergence above 5% was followed by a market downturn.

The rally in the Topix index hasn’t been accompanied by rising turnover, similar to last July’s pattern, suggesting there may be a lack of conviction in the market.

The market might face volatility after its rapid gains as we head into the “summer lull” period in August when the trading volume shrinks, said Rieko Otsuka, a strategist at MCP Asset Management Japan.

As Japan enters peak earnings season, some companies may maintain a cautious outlook as they gauge the impact of tariffs, said Otsuka adding that stocks valuation will need to be justified by earnings. The Topix index’s forward price-to-earnings ratio is now close to the levels just before last August’s decline, at 15.7 times versus 15.87 last July, but still cheap in comparison to the US.

Samaritans has announced plans to close at least half of its 200 branches across the UK and Ireland, move volunteers into larger regional hubs and pilot remote call handling, in a shake-up that has left some volunteers dismayed.

The mental health charity told volunteers in a video last week it hoped “within the next seven to 10 years, our branch network will have reduced by at least half” and that it would move to “fewer but bigger regions”.

The charity’s 22,000 listening volunteers answer calls and messages from people in mental health crisis at 201 branches across the UK and Ireland. It says its helplines receive a call every 10 seconds, while some branches also offer face-to-face services.

Julie Bentley, the charity’s chief executive, told volunteers that much of its fundraising income was going into “maintaining bricks and mortar, rather than being used to improve our services”.

The charity wants a “smaller number of larger brick branches” meaning “larger shifts open with more volunteers on duty together”.

It also said it wanted to make sure its buildings and shifts were “accessible to all” and hoped its “volunteer numbers will have increased as we offer more flexibility”, adding it had no plans to reduce the level of service it offered.

Some volunteers have expressed fears the charity is moving to a “call centre-style” model that would remove the “camaraderie” found in smaller branches. There were also concerns that volunteers, many of whom are over 50, would be unable to travel large distances to branches in large towns and cities.

They also raised concerns about the impact of a potential move towards remote volunteering, in which people would answer calls in their homes while in contact with another volunteer via video call. Some said they would feel uncomfortable taking distressing and sensitive calls at home.

One volunteer said: “It does change the absolute basis of how we have worked and the understanding of our need to be in a safe place where we have support as callers. Would the ambulance service suddenly decide to have people take calls in their home?

“The current system has operated very successfully for 70 years. Now they’re thinking of dismantling it, and in a way that I think has upset a lot of volunteers. A lot of us are anxious and worried.

“Almost every single volunteer that I have spoken to have said if they introduce call centres, we’re out. As well as helping others, people volunteer for their own mental health, to go to a safe space and meet like-minded people.”

The charity said remote volunteering would allow people unable to travel to branches to give their time, particularly for night shifts that are more challenging to fill.

Samaritans said it would consult volunteers about its plans before the trustees made a final decision in September, and any proposed changes that are confirmed will take place over a number of years.

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Volunteers said they wanted clarity on how much money the charity spends on branches, and how much it was projected to save by closing half down.

Samaritans’ annual accounts for 2023-24 show it has a fund of £7m for fixed assets including branches, a property maintenance fund of £28,000 and a branch support fund of £287,000, while it received £24.6m in charitable income.

In its last set of financial accounts, the charity said its “income was down for the third year running, while costs continue to rise”, and it had been forced to stop or postpone projects owing to lack of funding.

In a statement, Bentley said: “Samaritans provides a life-saving service, day and night, 365 days a year, but the changing needs of our callers and volunteers means thinking differently about the way our services need to work.

“We are engaging with our volunteers on proposed improvements that will mean we are able to answer more calls, have more volunteers on duty, and be there for more people in their darkest moments. Over 200 branches, varying in size from 10 to 300 volunteers, is not sustainable and hinders us providing the best possible service to people who need us.”