Further credit easing for manufacturing

The Ifo Institute regularly surveys businesses in manufacturing on the willingness of banks to give them loans. The credit climate calculated from the responses improved again in August 2006 in both western and eastern Germany. However, the enterprises located in eastern Germany still tend to give critical appraisals of banks’ willingness to lend. The improvement in the credit climate applied to all three company sizes (large, medium, small), although the recovery for SMEs was not as pronounced as for larger firms. As expected, firms with good business situations complained less frequently about banks’ restrictive lending policies.