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Long Recovery For UK Economy Forecast

UK Economy

The UK Britain faces a long recovery and growth will be small in 2010, but the Bank of England is still set to raise interest rates early in the coming year, according to the CBI (Confederation of British Industry).

The lobby group have predicted, in their latest quarterly economic forecast, that the Bank of England will start raising interest rates from the record low of 0.5% from next spring with an expected 2% to be reached by the end of the year.

Despite forecasting growth of just 0.3 percent in the first two quarters of 2010 the CBI believe that policy makers will be eager to return rates to a more normal level. (more…)

Credit Card Fees On The Rise

Interest Rate Rise

As lenders continue to fight rising bad debts, consumers will eventually carry the cost through a rise in rates and fees. Funding constrictions and the lack of borrowing is also having an impact on lender costs.

The rise in regulations and government scrutiny is shaking up the market to the point were by the current fee-free model on credit cards may be unsustainable.

“Lenders will be unable or unwilling to increase supply sufficiently to match demand. This will leave consumers surprised at both the cost of credit and the difficulty in gaining access to it,” PricewaterhouseCoopers partner Richard Thompson said. (more…)