October ECB bank lending survey, credit standards to ease

Euro area banks reported low investment decisions in H1 15, in Q2, the fixed investment contribution on firms' demand for credit represented 11pp, whereas the contribution from inventories stands at 10 and the contribution from other financing needs (LBO, M&A...) stands at 12.

"The October ECB bank lending survey that was conducted in September is likely to show signs of continued easing in credit standards, especially for households. Consumer demand for credit is likely to remain relatively buoyant with ongoing strength in demand for housing credit (49% in Q2, up from 30% in Q1) as interest rates remain low", says Societe Generale. 

The picture is more uncertain for firms. Uncertainty over global demand and high corporate debt levels means reluctance by firms to take out loans to invest. The point is that actual demand has not met expectations for the past three quarters.