The Bank of England sees risks in both China and emerging market economies to affect U.K. financial stability through the direct exposures of British banks.
BoE’s Financial Policy Committee said Friday that the immediate risks in relation to Greece and the euro area have fallen somewhat but other downside risks to financial stability stemming from the global environment have increased.
Disorderly conditions in one market can spill over to others. The FPC cautioned about future heightened volatility and reductions in market depth.
On housing market, the bank said there is no immediate case for action in the buy-to-let mortgage market.
Further, the committee said the government’s Help-to-Buy Mortgage Guarantee Scheme does not pose material risks to financial stability.
Moreover, the committee does not see a case for changing the fee or the current setting of the house price cap on financial stability grounds at this point.
The material has been provided by InstaForex Company – www.instaforex.com