KPMG comments on BoE money and credit data - June 2023

Karim Haji, EMA and UK Head of Financial Services at KPMG, comments on April’s Money and Credit Data from The Bank of England:

“The UK needs capital to flow through the economy to drive growth, but the amount coming out of the tap is slowing. Higher lending costs, lower risk thresholds of banks and a weak economic outlook mean that there is downward pressure on supply and demand, which has only been exacerbated by a recent spike in interest rates that triggered the withdrawal of hundreds of mortgage products. Lenders are looking for ways to support their clients through this challenging period, but the economics are unavoidable.

“The picture could further deteriorate as the latest Money and Credit figures won’t have fully baked in the rate rise we saw in late March and, of course, the further increase made by the MPC in early May. Lenders will keep a close eye on the stickiness of inflation as stubborn price data could extend and exacerbate these challenging lending conditions with further tightening of monetary policy down the line.

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About KPMG UK

KPMG LLP, a UK limited liability partnership, operates from 20 offices across the UK with approximately 17,000 partners and staff. The UK firm recorded a revenue of £2.72 billion in the year ended 30 September 2022.  

KPMG is a global organization of independent professional services firms providing Audit, Legal, Tax and Advisory services. It operates in 143 countries and territories with more than 265,000 partners and employees working in member firms around the world. Each KPMG firm is a legally distinct and separate entity and describes itself as such. KPMG International Limited is a private English company limited by guarantee. KPMG International Limited and its related entities do not provide services to clients.