Editor Brian Harrod Provides Comprehensive up-to-date news coverage, with aggregated news from sources all over the world from the Roundup Newswires Network
Initiative may continue beyond December as bank bosses raise concerns over mortgage market
The chancellor is considering extending the government’s mortgage guarantee scheme after UK bank bosses raised concerns over the state of the UK’s mortgage market at a high-level meeting at No 11 Downing Street.
The meeting on Thursday – which was attended by chief executives including Alison Rose of NatWest, Charlie Nunn of Lloyds Banking Group, HSBC UK’s Ian Stuart, Mike Regnier of Santander and TSB’s Robin Bulloch – was scheduled amid mounting fears about the potential fallout from rapidly rising mortgage rates.
Bank of England left with no action but to intervene after Kwasi Kwarteng’s mini-budget
The Bank of England has been forced into emergency action to halt a run on Britain’s pension funds after the impact of Kwasi Kwarteng’s ill-received mini budget prompted fears of a 2008-style financial crisis.
Threadneedle Street said the fallout from a dramatic rise in government borrowing costs since the chancellor’s statement had left it with no choice but to intervene to protect the UK’s financial system.
Bank of England’s chief economist speaks out after mini-budget, with financial markets expecting rates to reach up to 6%
Britain’s homeowners have been warned to brace themselves for a “significant” increase in interest rates from the Bank of England in response to Kwasi Kwarteng’s tax-cutting mini-budget last week.
Huw Pill, Threadneedle Street’s chief economist, added to the concerns of millions of mortgage payers who have already seen hundreds of home loan products pulled by lenders in anticipation of a big increase in the cost of borrowing.
Anti-poverty campaigners say world’s largest fund manager refuses to reduce or delay payments on Zambia’s debt
BlackRock, the world’s largest fund manager, has come under pressure to delay demands for debt interest payments from Zambia to prevent the crisis-hit African country’s finances from spiralling out of control.
Anti-poverty campaigners said BlackRock, which manages $10tn (£7.68tn) of assets, was among the private sector lenders that had refused to reduce the interest rate or delay payments on Zambian bonds, unlike governments and international agencies that hold the country’s debts.
Mark Haefele, chief investment officer, UBS Global Wealth Management, said:
While we expect the Fed to shy away from more radical easing measures, such as explicit controls on government bond yields, we believe Powell will likely outline other dovish measures. These could include a move toward average inflation targeting, giving the central bank more leeway to allow inflation to overshoot the 2% target while keeping rates pegged close to zero.
Maybe the age of the independent, activist central bank head is also coming to an end. Fiscal policy is more powerful and monetary policy needs to work in harmony with it. Monetary policy is being asked to do things (like tackle economic inequality) that it really isn’t suited to. But, here we are, waiting for Jay Powell to turn up at Grafton’s Saloon. He’s already done everything he can, he’s almost out of bullets and he may even have already won the fight, but we have placed our faith in him and desperately want fresh encouragement.
Returning infrastructure investment to 1970s levels may be undeliverable, says IFS
Labour and the Conservatives have triggered a public spending bidding war, promising massive programmes of borrowing that will return public investment to levels last seen in the 1970s, according to Britain’s leading experts on the public finances.
The Institute for Fiscal Studies said plans unveiled by Sajid Javid, the chancellor, and John McDonnell, his Labour shadow, would represent a decisive break with the past, but warned that a future government might have trouble delivering projects on the scale envisaged.