ECB reports weak lending in March

The European Central Bank said that bank lending to companies remains weak – another sign that the economy in the 17 countries that use the euro is still stuck in recession.

Loans to companies shrank 2.4% in March from the same month a year ago, only slightly better than the drop of 2.5% the month before.

The ECB said its current low interest rates are not getting through to companies in the form of credit that would enable them to expand their businesses. That is due to troubles in the banking system in some parts of the euro zone.

Many economists think the ECB will cut its refinancing rate from a record low of 0.75% at next week’s meeting to provide more stimulus.