Rising interest rates have led lenders to rein in the supply of credit to households in Q2, but they haven’t yet curtailed demand. That said, the latest credit conditions survey doesn’t capture the full extent of the recent rise in borrowing costs since mid-June. That suggests the resilience in demand is unlikely to be sustained and a further deterioration in bank lending will weigh on real activity in the coming months.
We’ll be discussing the UK inflation, growth and policy outlooks after the June CPI release on Wednesday 19th July. Register here to join that 20-minute online briefing.
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