Credit demand weakened in the USA
The US Federal Reserve (Fed) reported that credit standards in the country tightened and loan demand weakened in the first quarter of this year.
The US Federal Reserve (Fed) published the “Senior Loan Officer Opinion Survey” report on banks’ lending practices.
In the report prepared with the responses received from 66 domestic banks and 20 foreign bank branches in the USA, it was stated that the banks participating in the survey reported that the standards were tighter and demand was weaker regarding commercial and industrial loans given to businesses and commercial real estate loans in the first quarter of this year.
It was stated that the report also answered a number of specific questions about changes in banks’ credit policies and the demand for commercial real estate loans, and noted that banks tightened their lending policies for all commercial real estate loan categories.
Standards tightened in credit card, auto and other consumer loans
Regarding household loans, the report points out that credit standards have tightened in some categories of banks’ residential real estate loans, while there has been no change in others, and that standards have tightened and demand has weakened in credit card, automobile and other consumer loans.
In the USA, banks had begun to tighten access to credit by 2022, largely as a result of high borrowing costs caused by the Fed’s interest rate increases.
The Fed, which started to increase interest rates in 2022 in the face of high inflation in the USA, increased the policy rate to the range of 5.25-5.50 percent, the highest level in 23 years.