a deterioration in the prospects for the economy, and notably the housing market ) and supply - side factors ( such as increasing funding difficulties for banks ) ( slide 1 ). incidentally, these developments masked significant cross - country heterogeneity, as some countries saw an increase in flows supported by government measures aimed at the housing market. the annual growth rate of loans to non - financial corporations declined as well, reflecting particularly weak quarterly flows ( slide 2 ). there was considerable cross - country heterogeneity in this case too, with net redemptions taking place mainly in certain countries and loans to non - financial corporations continuing to grow in others. the worrisome picture of monetary developments was confirmed by the results of the bank lending survey for the fourth quarter of 2011. euro area banks tightened credit standards compared with the previous quarter for both loans to non - financial corporations and loans to households, and to a lesser extent for loans for consumer credit. furthermore, survey participants expected a further tightening of credit standards in the first quarter of 2012. even bis central bankers ’ speeches if the tightening was slower than during the 2007 – 2008 financial turmoil, it was starting from considerably tighter credit standards. although it is always tricky to disentangle supply - side from demand - side factors, banks explained their changes in credit standards mainly by primarily referring to increased funding costs and balance sheet constraints, which were compounded by a rapidly deteriorating economic environment. the funding situation of euro area credit institutions worsened noticeably in the second half of 2011, as shown by the rise in withdrawals of deposits held by non - euro area residents with euro area banks and difficulties in issuing longer - term debt securities. this caused banks to make greater recourse to eurosystem operations. the decline in credit to the private sector was accompanied by an increasing reluctance on the part of the euro area private sector to invest in financial assets ; it severely hampered banks ’ access to financing via the secured money market, due to an increase in haircuts and a deterioration of the available collateral. while market - based funding was becoming ever scarcer for banks in the euro area ( as investors were growing increasingly nervous about the escalation of the sovereign crisis ), banks were also facing regulatory and market pressures to strengthen their capital position. in short, back in december 2011, even though there was significant cross - country heterogeneity, the overall picture was rather gloomy. there were clear signs that supply - side factors were making banks

bank of japan ’ s may review of monetary and economic trends in japan bank of japan, monthly economic review, 20 / 5 / 97. japan ’ s economy continues on a moderate recovery trend despite some fluctuations caused by the rise in the consumption tax rate, with private demand showing underlying firmness. with respect to final demand, public - sector investment has decreased, and housing investment has declined, reflecting the reversal in the stepped - up demand which took place ahead of the rise in the consumption tax rate. however, net exports have continued to rise and business fixed investment is increasing steadily. despite the reversal in the stepped - up demand caused by the consumption tax rate hike, the recovery in personal consumption has not been hindered, given the moderate but firm recovery in labor market conditions and income formation. in these circumstances, industrial production has been firm to recover the level of inventories which declined owing to the temporary surge in demand ahead of the rise in the consumption tax rate. meanwhile, prices have stopped declining, and growth in monetary aggregates has continued at around 3. 0 per cent. with regard to personal consumption, outlays for travel have continued to increase moderately. with respect to goods, sales particularly in expensive goods surged in march 1997 ahead of the rise in the consumption tax rate, followed by a decline in april as its reaction. passenger - car sales recorded buoyant two - digit growth year - to - year for six consecutive months between october 1996 and march 1997, but showed a two - digit decline year - to - year in april. although sales of electrical appliances, as well as sales at department stores and supermarkets, rose significantly in march 1997, april figures available for department stores in tokyo are significantly below the previous year ’ s level. however, the recovery trend in personal consumption do not seem to have been hindered, as labor market conditions as well as household income formation are improving steadily, albeit moderately. among leading indicators of business fixed investment, machinery orders have increased steadily. construction floor area has also continued to recover moderately. with respect to housing investment, housing starts in terms of the seasonally - adjusted annual rate reached a significantly high level in the fourth quarter 1996, partly reflecting the stepped - up demand ahead of the rise in the consumption tax rate. later, they declined as the surge in demand reversed. regarding public - sector investment, the amount of public works contracted has quite recently picked up somewhat, reflecting orders included in the supplementary budget for fiscal 1996. however, public - sector