As Bernanke and company gather in Washington today and tomorrow to assess the strength of the US economy, there is some encouraging news from the country’s banks. Business lending grew at almost an 8% annualised clip in December, according to recent data. This, however, is unlikely to affect the Fed’s policy stance, with no change expected to the US$600bn asset-purchase programme or near-zero policy rates.

What’s more, the month-on-month annualised jump in business loans in December doesn’t tell the entire story. Year on year, the stock of commercial and industrial lending fell for the twentieth consecutive month in December. The ratio of banks’ cash to business loans, although down from recent all-time highs, remains elevated in historical terms.     

Recent data on lending, spending and—later this week—overall economic growth in the fourth quarter will give some comfort to American policymakers. However, the recovery has much longer to run. A Fed rate hike is unlikely before the second half of 2012.