A net 9% of euro area banks tightened business-loan standards in Q3, against 5% expected, and housing-loan demand fell a net 27%, the steepest drop since 2023. The ECB meets Thursday with its deposit rate at 2.50%.
IG Europe's Salaheddine Bouhmidi notes German firms' Ifo expectations at a February 2022 high even as ZEW analysts and GfK consumers turned more pessimistic. Source
Banks tightened by more than they said they would. In the ECB's Q3 bank lending survey, a net 9% of banks reported tighter standards on loans to firms, up from 7% in Q2 and above the 5% they had forecast. Mortgage standards were unchanged, while consumer credit tightened by a net 14%. France and Germany tightened, Italy eased and Spain held steady.
