At the latest Bank of England Monetary Policy Committee meeting it was unanimously agreed that interest rates would remain at 0.5%. This was entirely expected with a number of factors being considered such as global economic conditions, low UK inflation and the uncertainty of Brexit given the upcoming referendum.
Indeed potential UK exit from the EU was a big talking point at the recent meeting but the Bank of England have made it clear they are prepared for any eventuality and hope to continue economic stability.
One school of thought if we leave the EU is that the Bank could reduce interest rates further, this would be a post-crash first. Indeed out of 26 economists Reuters asked on the topic 17 said a reduction could occur. Despite this Mark Carney ruled out the introduction of negative interest rates.
The International Monetary Fund recently warned about the potential fallout of a Brexit, and downgraded their forecasts for UK economic growth in 2016 accordingly, from 2.2% (as forecast in January) to 1.9%.
The IMF’s chief economist, Maurice Obstfeld, said: “In the United Kingdom, the planned June referendum on European Union membership has already created uncertainty for investors; a Brexit could do severe regional and global damage by disrupting established trading relationships.”
In a previous post we commented on the negative effects constant low interest rates are having on UK economy and it would appear Brexit could pro long these negatives.
The aim of this post is to keep you abreast of the economic uncertainty we continue to face, these low interest rates are seeing people take riskier investments in the likes of property rather than save. We have seen the consequences of this before in Northern Ireland. It is incredibly difficult for people to make financial decisions in this current economic climate, especially those in financial difficulty.
EU Property Solutions assist borrowers with Corporate & Negative Equity Debt burdens and regularly achieve fantastic settlements for our clients. If you or anyone you know is suffering financial difficulty and wishes to obtain Independent Insolvency Advice then please call Eu Property Solutions today on +44 (0) 2895 217373. We offer all clients a free initial consultation and look forward to meeting you.