The UK’s ‘credit impulse’ just went sharply negative, and that explains why the Bank of England did not raise interest rates today

Pantheon Macroeconomics

• The amount of new credit issued in the UK suddenly went sharply negative in Q1,
• Consumers also abruptly increased their repayments of loans.
• Together, the two spikes — one down, one upward — send a worrying signal that British consumers are afraid of what’s ahead.
• That helps explain why the Bank of England did not raise interest rates today.
• The stakes couldn’t be higher: The data suggest that consumers fear Prime Minister Theresa May won’t get a Brexit trade deal that keeps Britain close to the EU.

LONDON — The amount of new credit issued in the UK suddenly went sharply negative in Q1 2018, dipping to a level it has not seen in six years.

See the rest of the story at Business Insider

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