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Economic data suggests quantitative easing may not be working

Despite the fact that the UK government and the Bank of England have placed a massive emphasis on quantitative easing, lending figures today show that perhaps the strategy is flawed and is not actually creating a return. The data showed that consumer borrowing is now down to the lowest level in 15 years, something which has disappointed many analysts who had forecast significantly higher figures.

Even though mortgage approvals rose from £331 million to £343 million over the last two months even this was well short of the £600 million expected by some experts. However it was the drop in unsecured consumer credit approvals which caught many by surprise with initial expectations of £300 million well in excess of the actual figure of £71 million. This would seem to indicate, that despite the investment of billions of pounds of taxpayer's money, the consumer credit market is literally dead on its feet and even the mortgage market is struggling to grow amid signs of a period of stabilisation at best.

While it must be said that these figures are disappointing it is very risky to take on face value one set of figures as opposed to looking at the overall trend. The next few months are vital for the UK economy and its future direction.

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