In a recent conference, the Governor of the Bank of England Mr Carney was asked about the continued rise of house prices and unsecured credit growth. He said ' he was "conscious" of those moves, although he pointed out that standards of lending in the housing market had improved and the number of distressed households had continued to go down.’
But some at the Institute of Directors (IoD) say there is a need to be vigilance, “there is genuine apprehension over asset prices, the misallocation of capital and consumer debt," said the IoD's chief economist, James Sproule, but "borrowing is comfortably below the unsustainable pre-crisis levels, but with debt once against rising there is a need for vigilance. "The question is, will the Bank look back on this unprecedented period of extraordinary monetary policy and wish they had acted sooner?” he said.
Despite these concerns, most do not see a rate rise until well into 2016. Howard Archer, chief UK economist at IHS Global Insight said: "The first interest rate hike from 0.50% to 0.75% is still most likely to happen in May 2016 - but the risks now seem to be that the increase could be later than this rather than before it. As things currently stand, an interest rate hike in the first quarter of 2016 looks unlikely."
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Source - BBC news
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