UK banks believe mortgage approvals set to fall
A survey by the Bank of England has today cast a shadow over the third quarter and latter part of 2010 with UK banks on the whole expecting a decline in mortgage approvals. Many believe that we will see a tightening of the fiscal environment in UK in the short-term, something which could well continue into 2011 unless the UK economy shows signs of improvement. Should we be alarmed?
The realisation that the UK economy is going to struggle in the short-term is something which many people have been warning of for some time. A number of analysts suggested that at the turn of 2010 the latter part of the year would see a tightening of fiscal policies and a reduction in economic activity. It would appear that these predictions are on the verge of coming true and indeed many banks and businesses appear to be readying themselves for a difficult end to 2010. Whether the situation turns out to be quite as bad as some are predicting remains to be seen but there is potential for the UK economy to move towards a nightmare double-dip recession in a worst-case scenario.
The newspapers are now full of doom and gloom in relation to the UK economy and there is the potential to actually talk ourselves into some kind of downward spiral.
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