Since the Bank of England's last Inflation Report in August, the path for Bank Rate implied by market rates has fallen by around 40 basis points, such that it only reaches 0.75% in 2017 Q2, compared with 2016 Q3 in August, and is just 1¼ by the end of 2018. The Bank of England admitted that it now seems more likely than not that inflation will remain below 1% until the second half of 2016, much later than judged likely when inflation first fell below 1% at the start of 2015. Recent falls in oil and other commodity
An increasing share of mortgages are being taken out by 25-34 year olds. Is there light at the end of the tunnel? Young people trying to make their way onto the housing ladder have not had much cause for celebration. Earlier in the year, a report from KPMG revealed that the average first-time buyer requires a salary of £41,000 to afford a property, and more than £70,000 in expensive areas such as London. The sense is that it’s never been harder for first-timers to own property. But data from the Office for
London’s housing market slowed sharply in the summer, industry figures show, while the market perked up in Scotland and Wales. The overall UK market is still rising fast, with a total of £11.8bn of mortgages approved in July, an increase of 15pc on the same time a year ago, according to the British Bankers’ Association. Mortgages to fund home purchases increased 11pc to £7.8bn, while remortgages rocketed by 29pc on the year to £4.1bn as home owners race to get a better deal before interest rates go up.
FUND manager James Anderson, who runs the £3.7 billion Scottish Mortgage Investment Trust, has warned there continues to be "unjustified greed" in a banking sector that has shown little appetite for change. Mr Anderson also states his belief that traditional banks are starting to become less central to the economic system as alternative models of financing emerge. In the Scottish Mortgage annual report he said: "There is still precious little evidence that the financial system has meaningfully reformed itself.
Virgin Money has reported a boost to profits with significant growth of its mortgage lending. The Edinburgh-based bank issued half-year figures showing underlying pre-tax profits up 37% to £82m. Gross mortgage lending was up 44% to £23.6bn. Virgin Money had 3.8% market share of the lending market at the end of May. Retail deposits were up 3% to £22.8bn, meaning 88% of lending is funded by depositors. Virgin Money is building its credit card business rapidly, following the transition of 675,000 accounts from