It’s always associated with a recession: last time, the Financial Crisis.
Over the past five decades, each time commercial and industrial loan balances at US banks shrank or stalled as companies cut back or as banks tightened their lending standards in reaction to the economy they found themselves in, a recession was either already in progress or would start soon. There has been no exception since the 1960s. Last time this happened was during the Financial Crisis.
Now it’s happening again – with a 1990/91 recession twist.
Commercial and industrial loans for the week ended May 10 fell to $2.095 trillion, according to the Fed’s Board of Governors on Friday. That’s down 4.5% from the peak in the week ended November 16, 2016. It’s below the level reported for the week ended October 19. And it marks the 30th week in a row of no growth in C&I loans.
This post was published at Wolf Street by Wolf Richter ‘ May 20, 2017.