Bank of England Money & Credit – comment
Following this morning’s Bank of England’s Money and Credit data, Paul Heywood, Chief Data & Analytics Officer at Equifax UK, commented: “Despite a tenth consecutive rate rise from the Bank of England, today’s Money and Credit data shows borrowing remains an attractive option for consumers, even in the face of the UK’s uncertain economic situation.
“Whilst the Bank’s interest rate increases may have boosted the attractiveness of savings, the reality of increased costs has likely led many households to dip further into essential reserves. These reserves may in turn be supplemented by high-cost short-term credit options to maintain a certain living standard, leading to a further squeeze on households already facing a real-terms pay cut due to inflation.
“With these high borrowing costs, we can expect to see the total value of consumer borrowing continue to increase. Although, if the Bank of England succeeds in taking some heat out of the market, we may see borrowing levels fall in real terms.
“There are certainly challenges ahead for borrowers and lenders, however the credit sector is prepared to meet these concerns and ensure that borrowers are protected and supported with the knowledge to ensure they can access the credit products they need.”