Credit markets beginning to move after G20 lift

| April 3, 2009 | 0 Comments
”Credit

There are finally signs that bank lending to companies and households will increase which will play a crucial part in the recovery from the recession, after a survey from the Bank of England revealed that credit conditions are improving.

The quarterly survey on credit conditions now shows that lenders expect availability of credit to both households and corporate customers to increase over the next three months.

Bank of England Governor, Mervyn King, has highlighted improved availability of credit to households and businesses as a linchpin for recovery as that is why improved availability of credit has been at the forefront of the Bank’s policy.

By reducing base rates and increasing the money supply by £75bn through asset purchases over the last three months, credit conditions and liquidity are finally rebounding, which will create foundations for business growth.

Howard Archer, chief UK economist at IHS Global Insight has said that the government policy measures to boost bank lending are now beginning to take hold, whilst the positive news form the G20 summit is going to increase confidence.

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