We should not be concerned about the normalization of monetary policy, but rather with the credibility and effectiveness of the reforms and the process of reducing the debt-to-GDP ratio. Banks Lending to the private sector in Italy is expanding again.
Loans to households remain brisk while those to firms are gaining pace in the manufacturing segment and expanding slightly again in services; the decline in lending to the construction sector is still pronounced, but is abating. Credit supply conditions are favourable overall; demand by firms has been limited by the ample availability of internal funds and greater recourse to non-bank financing.