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Guest The_Oldie

U.k. Mortgage Rates Surge, Confidence Slumps As Economy Weakens

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Guest The_Oldie


July 9 (Bloomberg) -- U.K. mortgage rates surged to the highest in eight years and consumer confidence fell, adding to signs that the economic downturn is deepening.

The rate on a home loan fixed for two years with a 25 percent deposit rose to 6.63 percent in June, the highest since February 2000, the Bank of England said on its Web site. Nationwide Building Society's index of consumer dropped the lowest since the survey began in May 2004.

The U.K. is skirting a recession as house prices fall, banks roll back credit and oil costs rise to records. Lenders aren't passing on the Bank of England's three interest-rate cuts since December, and policy makers, who make a rate decision tomorrow, have said they considered increasing borrowing costs after inflation accelerated to the fastest in a decade.

Consumers ``are recognizing that the economy is weakening, and that's going to affect them,'' said Fionnuala Earley, chief economist at Nationwide, in an interview on Bloomberg Television. ``The next move in rates will be down, but it will be much later this year or next year.''

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Barratts shares are up 21% this morning and all the other housebuiders are up too.

Edited by blankster

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  • 395 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?

      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%

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