Or they diversify away from short-term deposits and marketable instruments towards better remunerated – but riskier and less liquid – instruments. To the extent these instruments are outside M3, this dampens the growth in the broader monetary aggregate.
BIS central bankers’ speeches  3  On a positive note, we are observing some strong net inflows of capital from outside the euro area that support monetary dynamics. Since these inflows are directed at both, stressed and non-stressed euro area countries, they help mitigate financial fragmentation.