Credit growth slowed slightly in November, although mortgage lending increased, according to the latest figures from the Central Bank.

The annual rate of credit growth fell to 24.5 per cent in November from 25.1 per cent in October. At the same time, residential mortgage lending was up 20.1 per cent in November from 19.6 per cent the previous month, reflecting continued buoyancy in the housing market.

The figures are unlikely to please the Central Bank, as further cuts in interest rates due to take effect this month, and the possibility of even more falls, are likely to push the figures higher.

The problem, according to Mr Alan McQuaid, economist at Bloxham Stockbrokers, is that the ready availability of cash may make the financial institutions overly easy in supplying credit. That could have very unhealthy results in terms of bad debts when the economy does slow down.

However, the ECB will not take action to stem growth in one part of the euro zone and there is little the Central Bank can now do to slow down borrowing.