Ransquawk Overnight UK News 29/11/07

Discussion in 'Economics' started by Ransquawk, Nov 29, 2007.

  1. Ransquawk

    Ransquawk ET Sponsor

    Nationwide house prices (Nov) M/M -0.8% vs Exp. 0.1% (Prev. 1.1%), Y/Y 6.9% vs Exp. 8.4% (Prev. 9.7%) (RTRS)** UK house prices fall the most in 12 years this month. Nationwide predicts house prices will stagnate next year after gaining as much as 8% in 2007 as borrowing costs at a six-year high and a slowdown in economic growth curb demand for homes.

    There is lot of speculation the BoE is preparing to offer special assistance to the money markets through its short-term repo operation. There's some talk that could come today at the regular facility, though it seems more likely that the bank will wait until next Wednesday and the next of the current maintenance period. (UBS)**

    HSBC predicts property slump next year (Times)** House prices in Britain are overvalued by about 30%, according to HSBC, in a warning that the property market could suffer a similar slump next year to that experienced in the US. The paper also cities that repossessions could lead to oversupply. HSBC's chief UK economist, said that the coming property downturn would cause sterling to plummet and force the BoE to slash its interest rates aggressively.

    New fears for housing in credit collapse (FT front page)* This comes as the bank struggles to find money for mortgages.

    Alliance & Leicester and Bradford & Bingley, two of the largest UK mortgage lenders reported trading results today. A&L said 2007 core-operating profit is expected to be lower than some analysts forecast as it posted a charge on credit-related securities, However, the groups asset quality remains strong. The lender said the treasury impairment loss for SIVs in the 10 months to 31st October was GBP 40mln, and they expect the total cost of the buy back in 2007 to be GBP 200mln. Bradford & Bingley said underlying profit is expected to be in-line with current market consensus and that they have successfully funded the bank in very tough conditions. (RTRS)

    A Bloomberg survey shows strong backing for King after 50 out of 59 economists believe he deserves a second term (Telegraph)

    iBoxx Sterling Index extends by a large 0.1 years into December (MNI)

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