Business loan demand from large and mid-sized U.S. firms strengthened by the most in about three years in the third quarter while demand from small firms was essentially unchanged from the prior quarter, a Federal Reserve survey showed on Monday.
But the survey also showed banks on balance continue to tighten terms of credit for firms of all sizes, albeit not by the margin seen earlier in the year, the Fed's quarterly Senior Loan Officer Opinion Survey showed. That dynamic may limit credit growth even as demand improves.
Nationwide Financial Market Economist Oren Klachkin said tightening lending standards in the face of rising loan demand "will blunt the boost to growth from the Fed's 50 basis points of easing in the last two months and make it harder for policymakers to support the job market."
Please select this link to read the complete article from Reuters.