13 July 2006

'City faces meltdown if debt crisis hits'

Telegraph | Money | 'City faces meltdown if debt crisis hits': "In a worse-case scenario, a sharp fall in credit conditions worldwide would have devastating consequences for Britain, the Bank warns.
It could cause a 1.5pc contraction of the UK economy, a 25pc fall in house prices and a 35pc drop in commercial property prices over three years, according to the scenarios mapped out by the Bank. Other major countries would suffer similar effects, it says.

It also indicates that the risks of a serious financial problem in the City have increased during the past six months, and investors would be wrong to assume that, following the market turbulence of past months, the worst is now over"

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