• Demand decline driven by higher interest rates, subdued consumer confidence
  • Banks expect marginal rise in demand for loans in Q1 2024 though
  • Bank lending conditions tightened the most in real estate and construction sectors
  • Credit standards tightened further in Q4 2023 for both firms and households

The expected rebound in demand in the first quarter of this year would be the first rise since early 2022. That will ease some of the pressure off the ECB, as markets are arguably doing some of the monetary easing job for them by pricing in such aggressive rate cuts.