The figures: Commercial and industrial lending – a key economic driver – held up roughly in the week ending July 5, the Federal Reserve said Friday. Lending rose $200 million to $2.754 trillion, the central bank said.
Bank lending has slowly slowed, falling for the third month in a row. C&I lending peaked at $2.82 trillion in mid-March, just before the Silicon Valley Bank collapse.
Key details: Total bank deposits rose $24.9 million to $17.367 trillion in the week. Deposits have been shrinking slowly. They peaked at $18. 21 billion in mid-April.
The big picture: After Silicon Valley Bank’s collapse in March, economists have been watching the data carefully for signs of a credit crunch, as the bank has had a weak balance sheet as a result of the Fed’s rapid rate hikes since March 2022.
San Francisco Fed President Mary Daly said Monday she doesn’t see credit tightening beyond normal.
“I think, from the research literature, that this will take time to show itself, so I think we are still looking into the fall before we have a declarative statement on the extent of credit tightening and the impact on the economy. ,” said Daly.
Market reaction: DJIA shares, +0.33% SPX, -0.10% finished the week higher on Friday. The yield on the TMUBMUSD10Y 10-year Treasury note, rose 3.832% to 3.83%.