The Bank of England (BoE) warns that the number of UK households with an alarmingly stable level of debt this year is set to rise in 2023 due to higher prices and a less moderate labor market.
High interest rates and inflation .. The family budget is under pressure
” The share of households that allocate a significant portion of their income to their mortgages or loans should remain at its current level in 2022. But it will increase next year, the Bank of England estimates in its Financial Stability Report.
Les milliards de livres d’aides aux plus modestes annoncées par le gouvernement devraient en partie compenser cette année la hausse des taux d’intérêts et des prix, dans un pays o l’inflation pourrait des met démette année budget 11% under pressure.
But when this assistance ceases, the over-indebtedness” It should pass in 2023 above average”The past sixteen years, warns the Monetary Institute.
The outlook can turn bleak if the labor market deteriorates
The Bank of England estimates that the share of the households involved should remain.” Much lower than the pre-great financial crisis peak 2007 – 2.8% of them set aside more than 70% of their income to pay mortgage payments.
But the bank warns that this outlook could turn bleak if the labor market deteriorates faster than expected or if reduced risk appetite causes banks to reduce lending.
The Financial Policy Committee (FPC) is therefore asking British banks not to ” Lending Restriction “systematically because” The banking system will be able to resist to the economic shock.
he is ” It can even bear much worse expectations, which is a big difference with the financial crisisAndrew Bailey, Governor of the Bank of England, said during a press conference.
However, the Bank of England is requiring banks to keep 2% of all their loans in reserve, after lowering that threshold to 0% in the midst of the pandemic and then raising it to 1% at the end of 2021.
new ” stress test Of the major British banks, the launch of which was delayed due to the Russian invasion of Ukraine, will start in September 2022, with results expected in the middle of 2023.
Finally, the Bank of England confirms once again that cryptocurrencies, whose market has shrunk from over $3,000 billion at the high end of 2021 to just over $900 billion, do not represent It does not pose a threat to financial stability as a whole“.
” But if no action is taken, systemic risks will arise if crypto-asset activity continues to grow and connect to the rest of the financial system.‘, she warns.