Given that recent mortgage increases have largely been down to the fact that inflation has been worse than Bank of England forecasts, Chair of the Treasury Committee, Harriett Baldwin, welcomes the Bank of England’s agreement to her request to look at their inflation modelling and at why it has been incorrect.
The growth plan in September obviously had an impact on the mortgage market, but is the Economic Secretary to the Treasury aware that by November, the Governor of the Bank of England said, when he gave evidence to our Committee, that the increases in mortgages henceforth were down to the Bank of England’s own increases, because that temporary effect from the growth plan had dissipated? Increases since then have been largely due to the fact that inflation has been worse than the Bank was forecasting. Did the Economic Secretary note that this week I received a letter from the Chair of the Court of the Bank of England, saying that they are going to undertake the request that I sent for them to look at their inflation modelling and at why it has been incorrect?
Not for the first time, the Chair of the Treasury Committee is on the money in her understanding of what is driving the markets, and in her advocacy and championing of the fact that our lending banks need to do a good job not just for mortgage holders, but also for savers. I am happy to meet her to talk about how we can ensure that they do the best job they can.