As the Bank says borrowers can cope with rate hikes, are fears of a repayment crisis overdone? Rob Wood, chief UK economist at Berenberg Bank, says Yes. Some households will be poorly prepared for a rise in rates, but this is a question of magnitude. The Bank of England yesterday showed that, if wages grow, even a 2 percentage point rise in rates would just increase the number of vulnerable households to [...]
As the Bank of England predicts low inflation for longer, is real wage growth here to stay? Rob Wood is chief UK economist at Berenberg Bank, says Yes. Real wage growth is here to stay, but it’s important to keep some perspective. We are finally seeing wages rise above inflation, partly because petrol and food price falls have dragged the latter down. Money wage growth remains weak, if better than a few [...]
Will the Bank’s new powers to intervene in the housing market help prevent boom and bust? Rob Wood, chief UK economist at Berenberg Bank, says Yes. The Bank of England has a powerful set of weapons in its armoury to smooth out the cycles in the housing market. It can restrict the amount someone can borrow relative to their income, and the Bank has now asked formally for new powers to [...]
As politicians pledge more powers to Scotland, could this swing the referendum’s outcome? September 8, 2014 Rob Wood, chief UK economist at Berenberg Bank, says Yes. Scottish voters certainly want additional powers over their own affairs. If the UK government can credibly offer that without the need for splitting the country, it could convince some voters not to take the risk of independence. Alex Salmond has dismissed this so-called “devo max” [...]
As London house prices show signs of cooling, are fears of a bubble overplayed? August 12, 2014 Rob Wood, chief UK economist at Berenberg Bank, says Yes. Rapid rises in house prices would be a threat if they turned into an uncontrollable bubble accompanied by a rapid debt build-up. So it is good news that London house price inflation seems to be slowing down. And that slowdown has its roots in action [...]
Will financial sanctions on Russia significantly damage the City of London? July 24, 2014 Rob Wood, chief UK economist at Berenberg Bank, says Yes. Russia’s economy matters, even for the UK where only a small fraction of financial services activity is tied directly to Russia’s fragile petro-economy. The UK economy dances to the beat of world events because of confidence, uncertainty and financial market spillovers. The crisis in the [...]
