The Bank of England should move quick to quash any rapid growth in credit, one of its deputy governors has said.
Sir Jon Cunliffe told an audience of property developers that credit was growing at almost the same rate as the economy after contracting in the years immediately after the banking crisis.
He said: “If [credit] were to resume growing more than twice as fast as GDP, it could take a number of years for debt to income to retain its pre-crisis peak. But just as financial cycles build up over a number of years, the risks they pose are perhaps best managed over time.
“Given the vulnerability that already exists and the powerful drivers in the UK, particularly in the housing market, if credit began again to grow faster than GDP, I would want to think about action to manage the financial stability risks sooner rather than later.”
via The Guardian