Secondly, aggregate demand in the euro area remains relatively weak, and a significant recovery over the next few months seems improbable. In addition, the structural characteristics of the labour market, especially the differences in the salary indexation mechanisms, make price-wage spirals less likely.
Approvals are now running at about $ billion per month instead of $ billion at their peak last year. It is still far too early to know whether lending is returning to a sustainable pace - certainly $ billion per month is still far too high - but at least some progress has been made.