By Ovunc Kutlu
ISTANBUL (AA) - High interest rates are reducing credit growth in developed countries, according to a report released Tuesday by Fitch Ratings.
"Lending growth to households and corporates is declining swiftly in Europe, the US, Australia and Canada as monetary tightening takes hold," said the report.
"Bank lending in Spain and Italy is contracting in annual terms, while in France and Germany, it is decelerating rapidly."
The rating agency noted that loans to commercial and industrial businesses in the US are barely growing, slowing from a year ago, when they were rising at an annual rate of 15%.
High interest rates have also had a strong impact on mortgage borrowing in Canada and Australia, while there is a sharp slowdown in European businesses’ demand for credit, according to Fitch.
Many central banks around the world have implemented monetary tightening since the first quarter of 2022 in order to fight record inflation that climbed last year to their highest levels in decades in their respective countries.