Serial wire output on STM32L471ZGTx is not working - it hangs
I am using MDK5 (5.22) with STM32CubeMX (4.26.1). I generate blank project within CubeMX for STM32L471ZGTx (144pin MCU). Clock configuration uses internal HSI and LSI and it's set to 16MHz. For testing purposes I configured clocks so all other clocks are 16MHz (SYSCLK, APB1, Timers, Cortex etc...)

Under SYS menu I enable TRACE asynchronous SW to use SW for programming and SWO for retargeting printf.

I generate project and open it in MDK5 then under RTE editor I set up Compiler->I/O and select all options to ITM. So retargeting of printf goes to ITM.

Under options for target I enable TRACE - ITM channel 0.
Then I try to use printf in my main function
int main(void)
{
/* Reset of all peripherals, Initializes the Flash interface and the Systick. */
HAL_Init();
/* Configure the system clock */
SystemClock_Config();
/* Initialize all configured peripherals */
MX_GPIO_Init();
printf("Hello world\n");
...But I get stuck on that command. If I press Stop code execution it points to file retarget_io.c to line 99. Obviously I am stuck within that while-loop:

I can get anywhere with this... so far I tried different clock configurations, I checked for HW failure and there is solid connection to pin PB3 (SWO). I checked my ULINK2 programmer and tried with others... same problem.
I use same method for other projects with other MCU families which supports SWO and it works except with this one. I tried same approach on discovery board with STM32L475 and it works.
Any help/ideas would be much appreciated!
Thank you!