Latest / The European Economy Podcast with Fexingo: ECB, Eurozone, and Continental Markets
Why Eurozone Bank Lending Is Freezing Despite Rate Cuts
Episode 97 drills into a baffling disconnect: the ECB has cut rates twice since June 2025, yet eurozone bank lending to non-financial corporations contracted by 0.7% year-over-year in May 2026 — the sharpest drop since the sovereign debt crisis. Lucas and Luna unpack why lower policy rates aren't reaching the real economy: French banks tightening credit standards ahead of elections, German lenders hoarding liquidity, and the ECB's new 'capital buffer' rules that discourage risk-taking. They cite data on the TLTRO repayments, the Italian loan rejection rate (11.3%), and the…
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