Even before the FPC, housing momentum was fading but not priced by GBP
After the Bank of England announced their recommendations for macro-prudential measures last week, we noted that should the BoE begin to treat such measures as a substitute for monetary policy, it would represent a risk to our view on November tightening. While the BoE is clearly in favour of a later move, so far the measures in place should not be wide-ranging enough to materially affect wider monetary conditions and the outlook for spare capacity. However, the natural progression of the housing market itself could become a risk to the policy outlook.
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