The latest ECB survey indicates increased interest rates and loan costs, stable financing needs, and rising inflation expectations among euro area firms in early 2026.
The European Central Bank’s 38th Survey on the Access to Finance of Enterprises (SAFE), covering the first quarter of 2026, reports a net increase in bank loan interest rates (net 26%) compared to the previous quarter. Both small and large firms experienced similar rate increases.
Firms observed a net 37% increase in other financing costs, such as charges, fees, and commissions, with collateral requirements remaining unchanged at a net 14%. Financing needs remained stable, with a net 0% reporting increased needs, and a slight decline in loan availability (net -3%). The bank loan financing gap was slightly lower at 2%.
Firms expect marginally reduced external financing availability over the next three months. The main constraint on external financing remains the general economic outlook (net 26%), though banks’ willingness to lend improved slightly (net 5%). A net 8% of firms anticipate a more negative impact on sales and profits affecting external financing.
Turnover over the last three months was broadly unchanged, but 29% of firms expect an increase in the next quarter. Profits continued to decline, with 16% reporting lower profits. Investment levels decreased slightly but optimism about future investment remains high, with 13% expecting an increase.
Firms forecast stronger increases in selling prices (3.5%) and non-labour input costs (5.8%) over the next 12 months, while wage growth expectations moderated to 2.8%. The war in the Middle East influenced price and cost expectations, with firms reporting higher expectations after February 28. Inflation expectations for the next year rose to 3.0%, with increased dispersion and upside risks for the five-year horizon, where median expectations remained at 3.0% but with a wider distribution and 65% reporting upside risks.
The survey was conducted between 19 February and 1 April 2026, involving 10,544 firms across the euro area, with 92% having fewer than 250 employees. The report, questionnaire, and methodological details are available on the ECB’s website.
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