Another dovish sign for the European Central Bank ahead of Thursday’s governing council meeting as bank lending comes under further pressure from weaker demand and tighter credit conditions. The bank lending survey by the ECB shows that weaker economic conditions and higher interest rates are having a clear impact on borrowing. This is a sign that monetary transmission is working rather forcefully at the moment and will be taken by the ECB as a reason not to hike further, especially given the fact that the ECB itself only expects the biggest impact of higher rates in early 2024. Banks indicate that credit standards ... (full story)