It seems likely the Bank of England will cut interest rates this month, given that the Federal Reserve and Bank of Canada have both cut their respective interest rates.
There are concerns that the threat of coronavirus could impact economic confidence, resulting in the North Americans taking action.
These worries are shared in the UK of course, with many from the property industry suggesting the outbreak could put a breaks on the good start to the year we’ve had.
The Monetary Policy Committee’s next meeting is March 26, and unless something changes between now and then it seems almost certain that there will be a cut of 0.25%.
The question is whether a cut could happen sooner via an emergency meeting, which has happened twice before.
Budget 2020
On Wednesday we’ll also find out what the government plans to do in its Budget. Perhaps we might see some economic stimuli announced before the MPC even needs to move?
On the housing front there’s been lots of talk of a potential Mansion Tax coming into play, which seems dangerous given how heavily the market is already taxed.
Secondly there’s talk of a stamp duty surcharge of 3% on foreign buyers.
You wonder whether the government may ease up taxes elsewhere to compensate for these changes – because we need a thriving housing market not gridlocked by taxation.
The signs aren’t good, but hopefully the coronavirus threat will at least persuade the government to take measures to keep the housing sector thriving, given its importance to the economy.
I’ll see you on the other side.
Ryan Bembridge, Editor, PropertyWire
