George Osborne outlines plans to hand Bank of England new powers

In his first Mansion House speech, George Osborne outlined plans to give The Bank of England (BoE) far reaching new powers over Britain's financial system. In particular, the BoE will given the responsibility of overseeing the health of the housing market. Citing the easy availability of credit, 100%+ mortgages and low interest rates as key factors behind unsustainable house price increases, the chancellor of the exchequer argued that the BoE's new toolkit will enable it to avoid another housing bubble.

The BoE's new powers will also extend to curbing risky banking practices. This may well constrain the amounts which banks are able to loan to homebuyers, effectively allowing banks to place a cap on the amount homebuyers would be able to borrow. Full details of the new powers are to be unveiled in the emergency budget on the Tuesday 22nd June.

Sources: Channel 4 News | The Guardian
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