Is the Bank of England considering heavy duty credit easing?
Adam Posen, a member of the Bank of England MPC, has been talking about the problems ahead for the Bank of England with regards to the UK economy. He believes that if the quantitative easing program which many expect to happen in the short term is not successful then the Bank of England may need to adjust the borrowing costs in specific areas of the UK economy. He quoted "heavy duty credit easing" which is basically targeting specific sectors such as the housing market, financial sector, etc.
Over the last few months there has been a definite shift regarding the views of the MPC in relation to the UK economy and the upbeat stance seen at the beginning of 2010 has most certainly changed. There is talk of inflation, quantitative easing as well as potential "heavy duty credit easing". When you also consider the fact that the Bank of England has access to more detailed data on the UK economy we can automatically assume that the economic environment in the country is set to worsen in the short to medium term.
Quite how the Bank of England will react in the short term remains to be seen but quantitative easing would now appears to be almost inevitable.
Share this..
Related stories
Cash Genie to pay customers £20 million compensation
27/07/2015 Cash Genie, a payday loan company, faces a £20 million compensation bill for charging customers £50 for transferring them to the firms debt collection business. The Financial Conduct Authority (FCA) investigated the companies past processes and found a number of serious failings, which caused detriment to many customers, such as: • Unfair fees and interest • Loans bei...
Read MoreParents going for broke
Children are at risk of inheriting debts from their parents if adults in the UK do not take out life insurance policies, according to Life-Insurance-Online. Over 30,000 Brits were declared bankrupt during the first quarter of 2007 according to government figures and household debt reached £1.3 trillion in the UK in an April study by Ernst & Young.Credit borrowing has become a part of everyday lif...
Read MoreThe Abu Dhabi effect spreads across the world
As we mentioned in one of our earlier articles today, the Abu Dhabi government has today stepped in to bail out neighbouring Dubai with a $10 billion cash injection. This will allow the Dubai authorities to cover the redemption of a loan which is due today and also refinance and recapitalise any short-term obligations which may have initially been in danger. So what next? Worldwide stock market...
Read MoreGlobespan airline investigation goes to court
The investigation into the collapse of Scottish airline Globespan has taken a significant turn over the last 24 hours with news that the High Court in London has informed online transaction processing company E-Clear to clarify it has access to an alleged £35 million which it is said to have withheld from Globespan. PricewaterhouseCoopers has suggested that the withholding of the £35 million in...
Read MoreWhy have overdraft rates increased?
Over last 18 months there has been a massive increase in the rates charged on overdrafts by an array of UK banks. Many banks are now charging in the high teens and some have broken the 20% barrier which has resulted in a massive increase in the cost for UK consumers. So why have UK banks being so aggressive on the overdraft front? If you were to talk to any one of the major UK banks they would...
Read More