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November 2019

Disclaimer :
"Any views or opinions expressed in these blogs are solely those of the author and might not represent those of Access Credit Management Limited."

British Economy Expected to Grow By 1% in 2020

The latest predictions suggest that the British economy will grow next year. However, it is now believed that the growth will be only 1% which is lower than had previously been predicted.

The updated prediction comes from the EY ITEM Club. This is an economic forecasting group that looks at official Government data to spot trends.

The Fully Story

A Weak October for UK Services but the EU Predicts Stability

The British economy suffered another drop in the key services sector in October. The latest figures to be released showed that this was the seventh month of 2019 with declining new orders. 

Particularly noteworthy was the ongoing struggle of the UK’s car industry, which now shows an annual drop of 6.7%.

The Overall Figures

The Effect of Negative Interest Rates on Corporate Deposits and Banks

The arrival of negative interest rates has led to changes in how banks deal with their clients’ accounts. An example comes from Germany, where it has been revealed that more than half of the banks charge negative interest rates on corporate deposits. Meanwhile, banks there are dealing with falling profit levels.

Details of the German Survey

China Cuts Interest Rates to Boost Economy

The People's Bank of China have announced a small cut to interest rates. This move is seen by economists as a sign the authorities are still working hard to pull the economy out of a slump.

What Cuts Have Been Made?

The new lending rates in China saw a five basis point drop on the one-year loan prime rate (LPR), from the previous figure of 4.20% to 4.15%. The five-year LPR rate was reduced from 4.85% to 4.8%. The LRP was only introduced in August of this year as a new benchmark that may eventually replace the fixed lending rate that is currently used.  

US Federal Reserve Chairman Strongly Committed to 2% Inflation

Fed is “strongly committed” to sticking to their target of a 2% inflation rate.
This has been taken as a sign that the central bank isn’t planning to cut or raise interest rates in the near future. They believe that an inflation rate of 2% is the right level for allowing sustainable growth. It also gives them a degree of flexibility in terms of being able to change the interest rate if the economy goes downhill.