The numbers: Commercial and industrial loans — a key economic driver — rebounded by a seasonally adjusted $6.9 billion to $2.76 trillion in the week ending Aug. 30, the Federal Reserve said Friday.
Lending has been dropping for four straight months through July following the collapse of Silicon Valley Bank.
Key details: Lending by large banks rose by $5.2 billion to $1.55 trillion.
Lending by small banks slipped $500 million to $717.9 billion in the latest week.
Total bank deposits fell by $70.2 billion to $17.3 trillion in the same week. Deposits peaked at $18.2 billion in mid-April 2022, just after the Fed began raising its benchmark interest rate.
Big picture: Banks have been tightening lending standards and cutting back on lending to shore up their financial health. This has been tightening financial conditions. The economy seems to be growing despite these headwinds, but some economists think the tightening will get more severe as the year progresses.
Market reaction: U.S. stocks finished higher Friday after a quiet week during which the Dow Jones Industrial Average
DJIA
lost 1%. The 10-year Treasury yield
BX:TMUBMUSD10Y
rose by 8.4 basis points this week.
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