Note: The latest observation is for the second quarter of 2022. As a more bank-based system, the euro area might entail a more delayed reaction through the interest rate channel, as compared to countries where firms finance themselves predominantly with marketbased debt (Chart 5).
This is due to the slower speed of pass-through of market rate changes into lending rates on new loans compared with corporate bond yields. As already hinted previously, firms in the euro area rely predominantly on banks for their external financing compared to the United States.