Fighting Inflation and Hurting Credit

The video discusses the impact of monetary policy on lending trends in Europe and the US. In Europe, the European Central Bank's interest rate hikes have led to a significant drop in loan demand, raising concerns about economic contraction. In contrast, the US has seen stronger economic growth, although signs of stress are emerging in capital markets. The challenge for central banks is to manage inflation without causing economic distress.

What signs of trouble are emerging in the capital markets?

What is the challenge for central banks in managing inflation and lending stress?