Britain’s Brown meets bankers amidst gloom over economy

Britain’s Brown meets bankers amidst gloom over economy
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First Published: Tue, Apr 15 2008. 03 48 PM IST
Updated: Tue, Apr 15 2008. 03 48 PM IST
London: Prime Minister Gordon Brown met British finance chiefs at Downing Street Tuesday to discuss the credit squeeze as more bad news piled up about the economy.
Hours before travelling to the United States, Brown was expected to urge the heads of banks like Barclays, HBOS, HSBC and the Royal Bank of Scotland to pass on last week’s quarter-point Bank of England interest rate cut.
On Monday, Brown said that keeping the economy on track was his “sole focus.” As finance minister for 10 years from 1997, his political reputation is rooted in his economic record.
His Downing Street office said the financiers, who also include senior investment bankers, were not summoned for crisis talks and that the meeting had been planned for some time.
In a statement released afterwards, his office said: “The prime minister welcomed the opportunity today to consult a wide range of financial institutions and city representatives about the current situation in the financial markets and the next steps that all need to take.”
The bankers are likely to push for action to unblock money markets, including their wish for the Bank of England to accept mortgage-backed securities as collateral for government-backed bonds, reports said.
The meeting came on the back of economic bad news for Brown, who is also struggling with discontent among some lawmakers over poor poll ratings.
An influential survey suggested that confidence in the outlook for house prices in Britain had dropped to the worst level since 1978.
The figures from the Royal Institution of Chartered Surveyors showed a record number of surveyors reporting a drop in the cost of property during March -- 78.5 % more said values had dropped than those reporting a rise.
Official figures showed annual inflation remained steady in March at 2.5 % while the consumer prices index rose by 0.4 percent in March from February.
Later Tuesday, Brown was to urge oil-producing countries to step up production to ease prices during a speech at investment bank Goldman Sachs, according to extracts pre-released by his office.
“The market needs to be adequately supplied and oil-producing countries have their responsibility to respond to higher oil prices,” he said.
World oil prices hit record highs above $112 a barrel in Asian trade on Tuesday.
After the speech, Brown was to head to the United States, where he will discuss the state of the global economy with President George W. Bush and Wall
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First Published: Tue, Apr 15 2008. 03 48 PM IST