FRANKFURT, July 21 (Reuters) – Euro zone banks tightened access to credit in the second quarter over geopolitical instability fears, \u200cand they expect further tightening in the current quarter, the \u200cEuropean Central Bank’s quarterly Bank Lending Survey showed on Tuesday. <\/p>\n
The survey, a key input \u200bin policy deliberations, also indicates that while business loan demand increased, lenders rejected a larger share of applications, and credit standards tightened most in sectors such as the car industry and energy-intensive manufacturing, the \u200cECB said. <\/p>\n
The survey results \u2060are largely consistent with the ECB’s long-held view that the Iran war will be a small drag on \u2060economic growth as the 21-nation euro zone is a large energy exporter and any surge in oil prices weighs on consumption and dents \u200bmanufacturing profits. <\/p>\n
“Perceived \u200brisks to the economic outlook and \u200bbanks’ lower risk tolerance remained \u200cthe main factors contributing to the tightening, as banks remain highly attentive to risks related to geopolitical and energy developments,” the ECB said. <\/p>\n
“For the third quarter of 2026, banks expect credit standards to tighten further across all loan categories,” the ECB said, based on \u200ca survey of the bloc’s 159 largest \u200bbanks. <\/p>\n
The ECB is almost certain to \u200bkeep interest rates unchanged later \u200bthis week, partly because economic growth is weak, \u200cbut a hike in September remains \u200bmost ECB watchers’ \u200bbase case as the energy surge induced by the Iran war has lifted inflation to around 3%, far above the ECB’s \u200b2% target. <\/p>\n
For housing \u200cloans, demand already fell sharply in the second quarter and \u200bbanks project a further decline, the ECB added. <\/p>\n
(Reporting by \u200bBalazs Koranyi, Editing by Timothy Heritage) <\/p>\n","protected":false},"excerpt":{"rendered":"FRANKFURT, July 21 (Reuters) – Euro zone banks tightened access to credit in the second quarter over geopolitical…\n","protected":false},"author":2,"featured_media":552003,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[5461,114,250677,26517,11157,85,46],"class_list":["post-552002","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-banks","tag-business","tag-credit-standards","tag-euro-zone","tag-european-central-bank","tag-il","tag-israel"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/552002","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/comments?post=552002"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/552002\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media\/552003"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media?parent=552002"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/categories?post=552002"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/tags?post=552002"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}