BoE Financial Stability Report

Reading this report, it feels like the light at the end of the tunnel is a very long way off; mortgage forbearance, systemic risk in the banking sector, weak growth...and it looks as though private renters will be hung out to dry. This is not a happy read, despite the Governor's somewhat optimistic recent pronouncements.

The Bank of England Financial Stability Report paints a positive outlook for the banking sector but less so regarding the impact of higher interest rates on businesses, with corporate borrowers "more likely to cut back on spending, worsening the economic environment". Threadneedle Street adds that it will take time for the full impact of higher interest rates to come through. Hot on the heels of record wage growth figures, the report will add to the negative sentiment affecting business confidence. And the economy needs confident businesses to plan, hire and grow to reverse the current negative headlines.

It's all very well the Bank of England stating that borrowers can get help with their mortgages through the banks but by the time borrowers get to that stage, they’re already moving money around to try and meet payments and losing sleep over how they’re going to pay their mortgage. We need the Bank of England to fight for us, not to keep raising interest rates which is clearly not working. Also, extending your mortgage term isn’t as easy as the Bank of England seems to think it is. We are seeing people in their 60s, who’ve paid their mortgages all of their working lives, and are coming off fixed term mortgages yet, because of their age, lenders are quibbling over lengthening their term to help ease the pressure.