7 Feb

Darling offers reassurance on housing market

Darling offers reassurance on housing market

The housing market is more resilient than it was before the crash of the 1990s, chancellor Alistair Darling claims.

Speaking at the EEF manufacturing body's biannual dinner, he noted that some lenders were facing restrictions regarding the finance of mortgages and suggested the government would act to protect the wholesale mortgage market.

"We do not yet know the full effects of what has happened in the financial markets," he said.

"But we do know that there are good reasons to believe that we will get through this difficult time provided we do what is right for the country."

He went on to describe British economy as flexible and open and said unemployment levels were at a 30-year low.

The government intended to examine whether the introduction of a new gold standard for covered bonds and mortgage-backed securities would help the housing market and the wider economy.

Interest rates were cut in February from 5.5 per cent to 5.25 per cent by the Bank of England.

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