Wednesday, May 11, 2011
Lower Growth = Lower House Prices
The Bank of England today cut its growth forecast for the UK as it warned the squeeze on household incomes and Government austerity measures will continue to weigh on the economy. A continued surge in energy prices - including the cost of crude oil and soaring utility bills - will hit growth and increase the cost of living in 2011 and 2012, the Bank warned. Related articles The rate of inflation, currently at 4%, is now expected to hit 5% this year and remain above the Government target throughout 2012 before falling back in 2013 - but only if interest rates rise in line with market expectations from the third quarter of this year.