A (slightly messy) Chart of the Day - corporate demand for credit goes the way of consumer lending and mortgages:
It comes from the ECB’s lending survey for April - a publication that Robert Self, banking analyst at Credit Suisse, likes to keep a close eye on, since credit cycles have tended to correlate tightly with lending standards.
Where a positive number represents more banks reporting tighter standards, and vice versa, the scores for April were:
- Tightening in household loans (33 vs 21 in January)
- Tightening in consumer credit (19 vs 10 in January)
- Tightening in corporate credit (49 vs 41 in January)
And conditions are not looking to get much better in the short term, as CS’s Self explained in a note to clients on Tuesday:
The expectation for the Q2 2008 survey is for lending standards to tighten further, with tightening on household loans and consumer credit to be stronger than in Q1 2008, but tightening on corporate loans to be weaker. Demand for lending is expected to ease further across mortgages, consumer credit and corporate. Although this easing in demand is expected to be weaker on household and corporates than observed in Q1 2008.
Related links:
The Euro area bank lending survey - ECB
