• Home ::
• Fundamental ::
• Analysis Reports ::
• Friday Notes

• Send
• Print
• Add To
• Rss

Friday Notes

Banks tightening lending standards

Fri, May 9 2008, 12:30 GMT
by HVB Group Global Markets Research

HVB Group

● Squeeze. Even though the financial market crisis appears to be abating, loans are increasingly difficult to come by! In spring, banks tightened their lending standards world-wide, in some cases even massively. And there are no indications of a trend reversal any time soon.

● Contagion. Furthermore, consumer as well as corporate & industrial loans in the US are now also bearing the full brunt, after escaping most of the fallout at the beginning of the year (pages 4-6).

● Fed. That is an additional drag on growth (cf. chart) and is diminishing the efficacy of expansionary monetary and fiscal policy. It is, therefore, no wonder that Fed Chairman Bernanke is calling for additional measures from the US Administration. It is even possible that he will not be able to avoid a final rate cut after all.

● ECB. Banks in the eurozone have also tightened their lending standards substantially, which may have made Mr. Trichet more thoughtful. But though admitting growing downside risks, the ECB’s growth concerns remain limited, while its inflation "angst" is unbroken. It will, thus, not ease before the end of this year. And the recent surge in oil prices to ever new highs is merely reinforcing its reluctance (pages 7-8).

● Further topics:

• – Weekly Comment: Was that a hint, Mr. Trichet (page 2)

• – France: Ever stronger headwinds for the economy (page 9).
  

• – Data outlook: Robust EMU growth at the beginning of this year; US retail sales to decline (page 11).
  

• – Market outlook: Government bonds to firm again; EUR to stabilize (page 20).

• Download full report with charts

Published on  Fri, May 9 2008, 12:38 GMT

Archive

• US labor market – just a mirror image of the growth weakness
  Published On Fri, Jul 25 2008, 12:50 GMT
• Stagflation fears take center stage again!
  Published On Fri, Jul 18 2008, 12:51 GMT
• Widening EMU output gap to keep core inflation in check
  Published On Fri, Jul 11 2008, 12:21 GMT
• Fed to start normalizing its monetary
  Published On Fri, Jul 4 2008, 13:10 GMT
• The ECB's hike experiment
  Published On Fri, Jun 27 2008, 13:25 GMT

[ View All ]

• More Reports from this Author
• More Reports from this Contributor

HVB Group  | Bayerische Hypo- und Vereinsbank AG Am Tucherpark 16 80538 München
http://www.hvbgroup.com/ | hvbgroup@hvbgroup.com