The quarterly survey of the ECB to banks is very rich. It shows the evolution of credit conditions with respect to businesses and households, the reasons for the observed changes, but also the dynamics of demand for credit.
It is this latter aspect that interested me most notably focusing on business. This allows a view from a different angle of companies’ cyclical situation. It gives new information compared to more traditional surveys from the European Commission or from Markit.
The main point is to see if the improvement seen in these standard surveys can also be perceived in this ECB survey. Is there a rising trend in demand for credit that could be consistent with stronger momentum in economic activity?
The results are affirmative. Demand for credit has improved whether it is for large or small businesses within the Euro zone.
At the same time, banks have not tightened their conditions of access to credit. They continue to be quite accommodating (credit conditions are less stringent in April 2014 that what has been observed on average since the beginning of the survey in 2003)
Demand for credit is marginally greater than the demand usually observed since the beginning of the survey in 2003.
The second question concerns the reasons for this additional demand.
The graph below provides a forward response
There are four criteria which are here measured in points of standard error. 0 is the average of each of the criteria.
Generally the signals are positive. Credits associated with inventory and working capital are rising, correcting the sharp downturn in the January survey. This reflects a little more robust cyclical dynamics seen through the more traditional surveys.
The positive point is the increase in investment indicator. It passes into positive territory for the second consecutive quarter. According to the ECB observed changes are mainly in France and Italy rather than in Germany or Spain.
Needs for credit required for operations on capital also increase.

The corporate view through the prism of the ECB survey is rather positive. Credit demand improves. Reasons can be found in better orientation in investment and operations on capital. Companies can begin to imagine a more stable macroeconomic situation, a gradual return to growth with an economic horizon that lengthens.