Uk consumer spending down, is this the effect of bad credit mortgages?

Following the decision by the Bank of England’s monetary policy committee to cut Bank rate from 5.75% to 5.5% on Thursday, analysts are convinced further reductions are in the pipeline. This will help towards reset rates of bad credit mortgages borrowers.

The analysis, by Citigroup, suggests spending will rise just over 1% in 2008, after an increase of more than 3% this year.

US Federal Reserve, has cut its key Federal Funds rate by a quarter-point to 4.25% today. This is another move to counter act the bad credit mortgages crisis.

Weak growth and high inflation is highly likely next year. It calculates the probability of UK growth of less than 1% in 2008.