ECB Survey: Slight Easing of Credit Terms Amid Market Volatility

The European Central Bank (ECB) released its quarterly survey on credit terms and conditions in euro-denominated securities financing and OTC derivatives markets, covering the period from March to May 2026. The results showed a slight net easing of credit terms and conditions for all counterparty types for the second consecutive quarter.

Dealers repriced across all collateral types, particularly equity, as demand for secured funding increased. Non-price credit terms remained broadly unchanged across counterparty types, secured financing transactions, and non-centrally cleared OTC derivatives markets.

The survey was conducted during a period of heightened market volatility, triggered by an oil supply shock in the Middle East that drove commodity prices sharply higher. This had a negative impact on risk sentiment in March, but markets recovered strongly in April and May.

Market-implied policy rate expectations rose considerably over the review period, but credit terms and conditions proved resilient. Respondents reported that overall terms eased slightly for all counterparty types, with non-price terms remaining basically unchanged across the board.