UK Household Debt Driven by Asset Accumulation, Impacting Economic Outlook
The increase in household debt in the UK is mostly due to buying property, not excessive spending. This debt affects the economy based on how lenders and borrowers behave. The Inflation Report helps the Monetary Policy Committee make decisions by forecasting inflation and growth. When interest rates are far from normal, predictions based on market rates give a better idea of the economy's future than assuming rates stay the same.