More stringent capital requirements on lenders will raise the cost of funding, which other things equal will be passed onto customers through higher mortgage interest rate spreads. But we estimate there is still scope for lenders to absorb at least the first 50bps increase in Bank Rate by lowering spreads.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services