KPMG comments on today’s Money and Credit data from the Bank of England

Karim Haji, Global and UK Head of Financial Services at KPMG, comments on today’s Money and Credit statistical release from the Bank of England (for August):

“A rise in consumer borrowing in August could signal that many stretched households are still battling the cost of living by turning to credit to get by.   “With headline and services inflation coming in below the Bank of England’s August projections, we can expect an interest rate cut in November. Any drop in rates will be welcomed by households who are still feeling the cost of a higher for longer rate environment.    “But with living cost hikes still outpacing wages for some, households may struggle for the foreseeable. Therefore, it’s imperative that lenders not only place careful consideration on new applications for credit but offer compassionate approaches to debt and budget management.   “Mortgage borrowing figures for August show that appetite for longer-term secured borrowing is continuing to increase, with August’s figures marking the fourth monthly increase in a row. However, recent increases in mortgage approvals for house purchases could be curtailed if the Bank delays further rate cuts.”