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Ultra-low interest rates are set to return with inflation due to tumble in the near future, according to the International Monetary Fund (IMF).

This will be welcome news to homeowners, many of whom have recently been hit with a steep rise in mortgage costs.

The United Nations financial agency says that the combination of an ageing population and low productivity is set to rein in inflation and take interest rates back to pre-COVID levels.

Skyrocketing inflation, currently at a four-decade high in Britain, is only a hiccup in the overall trend for low interest rates, rather than a permanent change to the global financial landscape, the IMF said.

“Recent increases in real interest rates are likely to be temporary. When inflation is brought back under control, advanced economies’ central banks are likely to ease monetary policy and bring real interest rates back towards pre-pandemic levels,” a report by IMF economists concluded.

The IMF analysis found that the “natural” rate of interest had not been changed by the pandemic.

The so-called “natural” rates of interest, an anchor for monetary policy that neither stimulates nor discourages economic activity, “will remain low in advanced economies or decline further in emerging markets,” the report concluded.

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If accurate, that means less fiscal pressure as governments will be able to borrow more cheaply.

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But it would mean central banks, particularly in developed countries, may again have to rely on bond buying and other strategies to cut policy interest rates.

Some economists have argued the pandemic shifted the natural rate of interest higher, reversing forces like globalisation that helped keep borrowing costs low and also driving up government debts to historic levels.

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The Bank of England has released documents revealing a slight increase in UK’s GDP in Q2 of 2023, contrary to its earlier predictions of a technical recession.

The IMF said it is possible things have changed, and noted that the impact of developments like the transition to a less carbon-intensive economy remain to be seen.

However, the fund said its analysis suggests that the current high rates “are likely to be temporary”.

Once rates normalise to prior low levels, a deep enough recession may force central banks “to resort to the same strategies they employed in the decade before the pandemic, such as balance sheet policy and forward guidance”.

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UK

‘Nurse’ stabbed at hospital A&E department – man arrested on suspicion of attempted murder

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'Nurse' stabbed at hospital A&E department - man arrested on suspicion of attempted murder

A woman has suffered life-changing injuries after being stabbed by a member of the public at the accident and emergency department where she was working.

The victim – believed to be a nurse in her 50s – was attacked at Royal Oldham Hospital in Greater Manchester, where she is now being treated.

It is understood she was injured with a bladed article or a sharp instrument – and not by a knife.

Officers were called at 11.30pm on Saturday.

A 37-year-old man is in custody after being “swiftly arrested at the scene” on suspicion of attempted murder, Greater Manchester Police said.

Detectives are not looking for anyone else in connection with the incident and say there is no threat to the wider public.

Jim McMahon, the Labour MP for the area, described it as a “senseless attack”.

He posted on Facebook: “We are all shocked at the senseless attack on a nurse in the A&E department of the Royal Oldham Hospital.

“Our thoughts are with the nurse, family and friends as we wish a full recovery.”

Detective Sergeant Craig Roters said it was a “serious incident which has left a woman in a critical condition”.

The victim’s family and colleagues will be supported, he added.

The local community can expect to see an “increase in police presence” while enquiries are carried out, Mr Roters said.

“We know that news of this nature will come as a shock, and if you have any concerns or anything you would like to share, please speak to [officers].”

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UK

Kemi Badenoch calls on Sir Keir Starmer to sack Tulip Siddiq over property allegations

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Kemi Badenoch calls on Sir Keir Starmer to sack Tulip Siddiq over property allegations

Conservative Party leader Kemi Badenoch has called on Sir Keir Starmer to sack Treasury minister Tulip Siddiq over allegations she lived in properties linked to allies of her aunt, Sheikh Hasina, the deposed prime minister of Bangladesh.

It comes after the current Bangladeshi leader, Muhammad Yunus, said London properties used by Ms Siddiq should be investigated.

He told the Sunday Times the properties should be handed back to his government if they were acquired through “plain robbery”.

Tory leader Ms Badenoch said: “It’s time for Keir Starmer to sack Tulip Siddiq.

“He appointed his personal friend as anti-corruption minister and she is accused herself of corruption.

“Now the government of Bangladesh is raising serious concerns about her links to the regime of Sheikh Hasina.”

Ms Siddiq insists she has “done nothing wrong”.

Her aunt was ousted from office in August following an uprising against her 20-year leadership and fled to India.

Ms Siddiq is also named with her aunt in Bangladesh court documents about meetings with the Russian government.

Kemi Badenoch
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Tory leader Kemi Badenoch has called on Sir Keir to sack the minister

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As economic secretary to the Treasury, Ms Siddiq is responsible for policy on both the City and tackling corruption.

She referred herself to the prime minister’s ethics watchdog on Monday following the reports about the properties.

On the same day, the prime minister said: “Tulip Siddiq has acted entirely properly by referring herself to the independent adviser, as she’s now done, and that’s why we brought into being the new code.

“It’s to allow ministers to ask the adviser to establish the facts, and yes, I’ve got confidence in her, and that’s the process that will now be happening.”

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Search area widened for missing sisters in Aberdeen

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Search area widened for missing sisters in Aberdeen

Police in Aberdeen have widened the search area for two sisters who disappeared four days ago in the city.

Eliza and Henrietta Huszti, both 32, were last seen on CCTV on Market Street after leaving their home on Tuesday at around 2.12am.

The sisters – who are part of a set of triplets and originally from Hungary – crossed the Victoria Bridge to the Torry area and turned right on to a footpath next to the River Dee.

Eliza and Henrietta Huszti who were last seen on CCTV in Market Street.
Pic: Police Scotland/PA
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Eliza and Henrietta Huszti were last seen on CCTV in Market Street. Pic: Police Scotland/PA

They headed in the direction of Aberdeen Boat Club but officers said there is no evidence to suggest the missing women left the immediate area.

Specialist search teams, police dogs and a marine unit have been trying to trace the pair.

SN screengrab aberdeen city showing Victoria Bridge (looking north towards market street) re: missing sisters Eliza and Henrietta Huszti
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The sisters crossed Victoria Bridge before walking along a footpath next to the River Dee

SN screengrab aberdeen city showing boat club. A potential location of missing sisters Eliza and Henrietta Huszti
Ingest_23_NM23_RGR_15_SAF_MISSING_SISTERS_ABERDEEN_GVS_ABERDEEN
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The pair were heading in the direction of Aberdeen Boat Club on the south side of the River Dee

Further searches are being carried out towards the Port of Aberdeen’s South Harbour and Duthie Park.

Police Scotland said it is liaising with authorities in Hungary to support the relatives of the two sisters.

datawrapper map of aberdeen city showing location of police searches for missing sisters Eliza and Henrietta Huszti

Chief Inspector Darren Bruce said: “Eliza and Henrietta’s family are understandably extremely worried about them and we are working tirelessly to find them.

“We are seriously concerned about them and have significant resources dedicated to the inquiry.”

The sisters, from Aberdeen city centre, are described as slim with long brown hair.

Henrietta  Huszti who along with her sister, Eliza, were last seen on CCTV in Market Street.
Pic: Police Scotland/PA
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Henrietta Huszti. Pic: Police Scotland

Eliza Huszti.
Pic: Police Scotland/PA
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Eliza Huszti. Pic: Police Scotland

Officers have requested businesses in and around the South Esplanade and Menzies Road area to review their CCTV footage for the early morning of Tuesday 7 January.

Police added they are keen to hear from anyone with dashcam footage from that time.

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