Labour win will add £65 to mortgage
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A Citigroup economist has warned that a hung parliament or a Labour victory at the next election would add an average of £65 to individual mortgage costs.
Michael Saunders sent the warning to bankers and traders earlier this week, the Metro reports.
Saunders says: “Unless we get a Conservative government with a clear majority, we think gilt yields will have to rise to about 4.75% and higher if inflation remains a threat.”
Gilts, or government bonds, are used to price mortgages so mortgage payments tend to rise in line with the cost of gilts.
Readers' comments (3)
Grey Haired underwriter | 5 Mar 2010 11:16 am
All I can say is that economists seldom get it right or we would not be in the mess we are in. And an economist for one of the remaining major American banks...........!! I leave that thought for everyone
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chris in Bristol | 5 Mar 2010 12:59 pm
mmm ... we will see a lot of this garbage as the election approaches.
Loads of vested interests trying to influence the outcome.
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Salil Chaudhari | 7 Mar 2010 7:46 pm
Nothing has gone right for the economists and so now there is only one thing left for them-a feeling of GILT!
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