In parliament yesterday Alistair Darling announced some changes that were aimed at stimulating lending back to the levels we saw in 2007. Despite the £37 billion Government bailout, that occurred during October, lending remains at a third of the levels seen in the previous year. The interest rate cuts announced on the 5^th December 2008 have yet to revive the housing market. This is because the rate cuts have not been fully passed on to consumers by banks who are not dropping mortgage rates as quickly as the base rate.

Gordon Brown, yesterday pledged to increase the amount it will lend at no interest to first time buyers from 300 million to 400 million as part of the First Time Buyer Initiative. The Government is doing everything they can to increase lending and bring the UK out of recession as quickly as possible.

In currency markets the GBP against the USD rose sharply yesterday back above 1.50.  Whilst the pound hit a new low against the Euro dropping 22% over the last 12 months to hit an all time low of €1.1086 and the fall has accelerated over the last few days.

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