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Recessions occur because the Fed's short-term interest rates determine the level of all rates in the economy: the Fed's rate hike implies higher rates for credit to companies, for mortgage loans and for consumer loans, etc.
June 21, 2022
Mexico | The financial system shows resilience in the face of the current risk scenario
In addition to the remaining effects of the pandemic, challenges associated with the geopolitical conflict between Russia and Ukraine, global inflationary pressures and the tightening of financial conditions worsen the current risk scenario.
In April 2022, the balance of traditional bank deposits exhibited a real YoY growth rate of 1.5%, while outstanding credit granted by commercial banks to the non-financial private sector (NFPS) grew 0.9% in real terms, the first real growth rate recorded since July 2020.
In the Spanish banking system, 2022 will go down in history because several events will occur (or are already unfolding) whose impact on the industry’s results are hard to gauge. Two such events are the war in Ukraine and the end of the grace period for ICO-guaranteed loans.
Credit to households has shown greater recovery and is the main impulse for the growth of financing to the private sector, while the weakness of business financing lingers. Likewise, demand deposits maintain their dynamism, while the growth of time deposits remains in red figures.
In March 2022, the balance of traditional bank deposits registered at a nominal annual growth rate of 7.8%, while the balance of the current credit portfolio granted by commercial banks to the non-financial private sector (NFPS) registered a nominal annual variation of 6.9%.
The incomplete recovery of the components of aggregate demand compared to the period prior to the pandemic does not favor the reactivation of the demand for financing from the SME segment, whose balances have presented heterogeneous dynamics both among sectors and uses of credit.
In February 2022, the balance of traditional bank deposits increased at a nominal annual growth rate of 6.8%, while the balance of the current loan portfolio granted by commercial banks to the non-financial private sector (SPNF) grew 5 .3% in nominal terms.