Liberal Democrats in Business

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House Price Inflation Should Be Incorporated Into CPI - Cable

12.46.00pm GMT Thu 6th Dec 2007

Responding to the announcement by the Bank of England of a cut in interest rates, Acting Liberal Democrat Leader and Shadow Chancellor, Vince Cable MP said: "With the current environment of panic in the City, reduced consumer confidence and the credit crunch biting, it was obvious that the Bank of England would cut interest rates.

"However, the problem still remains that the Bank cannot take account of inflation and deflation in asset markets when making interest rate decisions.

"House price inflation should be incorporated into the Consumer Price Index."

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