U.S. Markets

U.S. banks eased some business loan standards in third quarter: Fed

FILE PHOTO: A cyclist passes the Federal Reserve building in Washington, DC, U.S., August 22, 2018. REUTERS/Chris Wattie/File Photo

WASHINGTON (Reuters) - Loan officers at U.S. banks reported easing lending standards for commercial and industrial loans while keeping terms for commercial real estate loans almost unchanged in the third quarter, a Federal Reserve survey showed on Tuesday.

However, the bank officials also said they were seeing weaker demand for commercial and industrial loans from firms of all sizes, which banks said was partially in response to reduced investment by some customers in plants and equipment.

The Fed has raised interest rates eight times since it began a tightening cycle in December 2015, including three times so far this year. The Fed is widely expected to raise rates again in December.

Banks also reported easing lending standards for residential real estate loans while leaving standards largely unchanged for auto loans.

The Fed surveyed loan officers at 70 domestic banks and 22 U.S. branches and agencies of foreign banks.

Reporting by Jason Lange; Editing by Andrea Ricci