Monetary policy and inflation - Philip R. Lane

Deposits developments and bank funding in the US and euro area (I) Rubric

Bank funding in the US

(cumulated monthly differences in outstanding amounts in USD bn since end-March 2022; SA bank deposit, NSA bank bonds)

Mar-22 Jun-22 Sep-22 Dec-22 Mar-23

Sources: Federal Reserve Board/Haver Analytics and ECB calculations.

Notes: Banks are domestically chartered commercial banks, US branches and agencies of foreign banks and Edge Act and agreement corporations. Bank bond data are quarterly and interpolated at monthly frequency. Consolidated bank bond issuance.

Latest observation: March 2023 for bank deposits (March monthly observation covers until 22 March). The latest observation for bank bonds, and thus also for the total, is December 2022.

Bank funding in the euro area

(cumulated flows in EUR bn since end-September 2022; SA)

Sources: ECB (BSI) and ECB calculations. Notes: Bank deposits consist of deposits held with the MFI sector by euro area money holding sector excluding financial vehicle corporations involved in securitisation activity. Their flows have been adjusted for the operational incident in TARGET2 which is the main factor affecting deposits with the Eurosystem in recent months. This factor inflated the September 2022 OFI deposits, being reversed in October and November 2022. Bank bonds are those held by the euro area money holding sector. Latest observation: February 2023.

Deposits and money market funds in the US

(cumulated monthly differences in outstanding amounts in USD bn since end-March 2022; money market funds NSA, bank deposits SA)

Mar-22 Jun-22 Sep-22 Dec-22 Mar-23

Sources: Bloomberg, Federal Reserve Board/Haver Analytics and ECB calculations. Latest observation: March 2023 (March monthly observation covers until 22 March).

Deposits, money market funds and bank bonds in the euro area

(3-month cumulated flows in EUR bn; SA)

Net deposits by OFIs Bank bonds Money market funds

200200

150150

100100

5050

00

-50-50

-100-100

-150-150

Feb-22 May-22 Aug-22 Nov-22 Feb-23

Sources: ECB (BSI) and ECB calculations.

Notes: The OFI sector comprises non-bank financial institutions other than pension funds and insurance corporations. Net deposits by OFIs consists of M3 deposits held by OFIs minus loans to OFIs. Figures have been adjusted for the operational incident in TARGET2 which inflated the September 2022 OFI deposits, being reversed in October and November 2022. Latest observation: February 2023.