Eurozone Bank Lending Growth Accelerates Despite ECB Rate Rise

Eurozone bank lending continued to strengthen in July, with households borrowing 3.1% year on year and non-financial corporate lending up 4.4%, underscoring continued resilience despite the ECB’s rate hike. The data suggest that credit growth is tolerating tighter financial conditions and that the lending channel remains robust, even as longer-term rates rise and monetary policy tightens. Analysts warn that further rate increases could dampen loan demand later in the year, though sources also point to factors supporting growth such as fiscal spending and AI-related demand. The July figures align with other upbeat indicators, including euro-area GDP momentum and improving business sentiment, while the ECB assesses how the rate move feeds through to borrowing conditions. Overall private-sector credit growth accelerated to multi-year highs, indicating positive momentum entering the second half of 2026.