MorganAsh comments on BoE MPC decision
21 March 2024
Following the decision by the Bank of England to hold the base rate for a fifth consecutive time at 5.25%, we have a comment from MorganAsh.
MorganAsh provides the award-winning MorganAsh Resilience System (MARS) to enable brokers, advisers and financial services firms to better manage and evaluate consumer vulnerability and comply with Consumer Duty.
Andrew Gething, managing director of MorganAsh, said: “While many would have hoped for a cut, holding base rate at 5.25% was always the most likely outcome. Even with positive headlines around inflation yesterday, the MPC will have one eye on high services inflation, as well as number of macro challenges that could still upset the apple cart.
“Although a fifth consecutive hold brings stability, it also keeps interest rates at an elevated level – adding further pressure onto customers and potentially pushing many into a vulnerable position. With predictions of August bringing the first cut to base rate, this strain on households is only set to continue. It’s no wonder then that the FCA has this week announced its review of how firms approach consumer vulnerability, especially as many continue to say they have few – or even zero – vulnerable customers.
“If the base rate does fall in August, as many predict, firms will have to report on outcomes for vulnerable customers ahead of this – with July marking the one-year anniversary of Consumer Duty. A proactive approach to assessing all clients is absolutely critical in generating the necessary data firms need for the management information and reporting the regulator will require.”
