News in brief - 16 June 2022

Welcome to the News in Brief, a daily summary of the latest banking and finance news.

FCA WRITES TO LENDERS TO SUPPORT CONSUMERS STRUGGLING WITH THE RISING COST OF LIVING

The Financial Conduct Authority (FCA) has written a letter to 3,500 lenders to remind them of their obligations to support consumers struggling with the rising cost of living (Reuters). Its executive director of consumers and competition Sheldon Mills said “early action is important for those struggling with debt” and that all firms need to “get the basics right and provide good quality support” (Sky News). It comes as the Institute of Grocery Distribution has predicted that food prices will rise at a rate of 15 per cent this this summer due to increasing energy and fuel costs (BBC News). 

TREASURY SELECT COMMITTEE REPORT WARNS AGAINST FINANCIAL RULES BEING WEAKENED ‘INAPPROPRIATELY’

MPs on the Treasury select committee have said they will remain “alert for any evidence that regulators are coming under undue pressure from the Treasury to inappropriately weaken regulatory standards” (Financial Times). In a report from the committee published today, it also proposes that financial regulators should speed up authorisations of new firms, and report annually on how they promote financial inclusion and help vulnerable consumers (Reuters).

Writing in The Times, the committee’s chair Mel Stride also sets out how the FCA and the Prudential Regulation Authority should each be given a new secondary objective — to promote long-term economic growth.

NEWS IN BRIEF

The US central bank has increased its key interest rate by three quarters of a percentage point to a range of 1.5 per cent to 1.75 per cent, the biggest rate rise in nearly 30 years. It comes as the Bank of England will announce its interest rate decision at midday today (BBC News).

The government has published a white paper today announcing new protections for tenants in private rented accommodation in England, including a ban on no-fault evictions (Financial Times).

In an interview with Bloomberg, the UK’s digital minister Chris Philp said he wants the UK and London to be crypto centres but “in a way that protects the public” (Bloomberg).

The Labour party has launched a review of business funding to support start-ups in the UK, with the shadow chancellor Rachel Reeves saying “Labour’s mission is to build an institutional ecosystem offering the market the access, finance and skills that new and growing businesses need” (The Guardian).

In an interview with Sky News, the former chancellor Lord Hammond said he thinks that the UK economy will slow down quite sharply in the autumn, saying “all the data points that way” and that the country faces a “very, very difficult period ahead in the short term” (Sky News).

Area of expertise: