Aug 3 (Reuters) - Respondents to a Federal Reserve banking survey reported “basically unchanged” lending standards for commercial and industrial loans during roughly the second quarter, with stronger demand for that type of loan coming from large and middle market firms.
“For loans to households, banks reported mixed changes in lending standards and weaker demand for residential real estate," the Fed said in its latest quarterly Senior Loan Officer Survey, opens new tab, this time for July. It noted lending standards tightened for credit card loans amid stable demand, while standards were unchanged for auto and other types of consumer loans, though demand for car loans eased.
The Fed report said that demand for credit at smaller firms during roughly the second quarter was about the same for all banks that responded to the survey.
The report also said that "on balance" lending standards are "at the tighter end of the range for all loan categories except C&I loans, for which standards are generally easier than their midpoints" of the range they have varied against since 2005.
The update on lending standards and credit demand comes as businesses have been dealing with persistently strong levels of inflation in an economy where growth remains solid and the job market has been stable.
The Fed has been wrestling with whether it might need to raise rates and increase the cost of short-term borrowing to bring inflation back down to the 2% target. Last week, the central bank held its interest rate target range steady at between 3.5% and 3.75% as Chairman Kevin Warsh declined to give guidance.
Reporting by Michael S. Derby Editing by Nick Zieminski
