The European Central Bank, in its regular monthly money supply data, calculated that growth in eurozone bank loans contracted by 0.2 percent in June after shrinking by 0.1 percent in May. That figure suggests eurozone lending to the private sector has dried up, despite the vast amounts of cheap cash banks in the bloc borrowed from the ECB earlier this year. At the same time, the eurozone money supply is growing, the data showed, with the broad M3 indicator rising 3.2 percent last month, following a gain of 3.1 percent in May. The acceleration was unexpected -- analysts polled by Dow Jones Newswires had been pencilling in a slight slowdown in growth to a rate of 2.9 percent for June. The ECB regards the M3 figure as a key guide to inflation pressures and uses it to set interest rates accordingly. The central bank seeks to keep eurozone inflation below but close to 2.0 percent but it stood at 2.4 percent in June.

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