Further confirmation, for the

The Bank of England has warned of an extended squeeze on household incomes, saying that the worsening eurozone crisis had made it more expensive for banks to raise money and that UK borrowers could suffer from higher interest rates as a result.

Some analysts regard the sharp fall in household deposits last month as the most troubling of the data. The 638 billion yuan (£64 billion) month-on-month drop denotes a clear attack of nerves, and contributed to an 8 per cent fall in new loans. (…) “There are major problems,” said Miranda Carr, head of research at China Policy Research. “Money is leaving the country and that is going to affect the ability to stimulate. If the banks don’t have the deposits there to lend out, then that means stimulus is not as effective as it might be.”