Eurozone banks tightened access to mortgages in the three months to September and expect to continue doing so in the final quarter of the year, a European Central Bank (ECB) survey revealed on Tuesday. The survey also showed that, in the fourth quarter, banks plan to tighten credit standards for loans to businesses and to ease criteria slightly for consumer credit.

Lending standards for consumer credit and other lending to households remained broadly unchanged in the third quarter. Banks’ overall terms agreed in loan contracts, eased slightly for loans to firms, while they tightened for housing loans and remained broadly unchanged for consumer credit in the third quarter.

Meanwhile in the US, consumer confidence unexpectedly rose in October as worries about rising inflation were offset by improving labour market prospects, suggesting economic growth was picking up after three consecutive months of declines. The Conference Board said on Tuesday that its consumer confidence index jumped to 113.8 in October, from an upwardly revised 109.8 in September. The rebound surprised economists, who had expected the consumer confidence index to inch down to 109.0.

In the US, consumer confidence unexpectedly rose in October as worries about rising inflation were offset by improving labour market prospects- Bank of Valletta

“While short-term inflation concerns rose to a 13-year high, the impact on confidence was muted,” said Lynn Franco, senior director of economic indicators at The Conference Board.

Finally, UK Chancellor Rishi Sunak raised the public spending bill by a massive £150 billion to support a strong economic recovery after the crisis caused by the COVID-19 pandemic. That will be the largest spending increase this century, with spending growing by 3.8 per cent a year in real terms by 2024-25, Sunak said in his autumn budget speech in the Parliament on Thursday.

The chancellor said the latest budget began the work of preparing for a new economy post-pandemic. Headline inflation, which hit 3.1 per cent in September, is set to rise further to average four per cent over the next year, Sunak said, citing official forecasts. The chancellor blamed the global supply chain disruptions and surging energy prices for the higher inflation.

This article has been prepared by Bank of Valletta plc for general information purposes only.