Mark Carney
has signalled that he is prepared to act to prevent a housing bubble
getting out of control as he delivered his first speech as Governor of the Bank
of England. The Bank could use new tools to recommend that banks and
building societies "restrict the terms on which new credit is provided, or
even to raise capital requirements on mortgages or other types of
lending", he told business leaders in Nottingham. Mr Carney
added: "The Bank is acutely aware of the risk of unsustainable credit
and house price growth and will be monitoring it closely. The important thing
to recognise is that we now have tools other than interest rates that can be
used to contain risks in the property and financial sectors. We are
now fully prepared to deploy them if that were needed."
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