14 Sept 2022 Eurozone Monitor Will the Energy Crisis and ECB hikes lead to a Credit Crunch?

Melanie Debono (Senior Eurozone Economist)13th Sep 2022 15:27Eurozone, Daily Monitor

Our forecasts for ECB rates imply a rise in mortgage rates of over 400bp, raising the risk of defaults.
Rising mortgage rates will mean house prices will be falling by around 1% year-over-year by end 2023.
Higher risk is already discouraging banks from lending, but a credit crunch will likely be avoided.

bank lending credit deposits disposable income ECB ecb policy energy energy prices ez households germany house price house prices house purchase housing costs interest rate interest rates July lending growth loans May mortgage mortgage rates mortgages new mortgages policy policy rates q2 q4 savings spain unemployment unemployment rate weather

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