Britain’s biggest mortgage lender expects three interest rate cuts this year
The boss of Britain’s biggest mortgage lender has told Sky News he expects three interest rate cuts this year, bringing some relief to borrowers and mortgage holders.
Lloyds Banking Group chief executive Charlie Nunn said he anticipates rates will continue to fall gradually thanks to the resilience of household and business finances – but cautioned that the UK could expect low growth because of a relative lack of investment.
Speaking at the World Economic Forum in Davos, he said: “We think there’ll be three rate cuts this year.
“Of course, most people choose to fix their mortgage for two to five years and the pricing on that has been relatively stable and we think that stability is likely to remain for the remainder of this year.
“Those that are on the fixed rates are in a good place, and for those that are on a variable rate, their mortgage is likely to continue to come down slowly with the base rate.
“For those that are remortgaging, they are likely to get a significant uptick depending on when they set their mortgage.”
As Britain’s longest-serving bank chief in charge of the largest retail lender with more than 27 million customers, Mr Nunn is well-placed to assess consumer sentiment and economic prospects at the start of the year.
Lloyds Banking Group chief executive Charlie Nunn
He added: “The UK economy is what I would characterise as very resilient but relatively slow growth. And that’s first of all because household finances continue to strengthen – there are some customers struggling to make ends meet and we’re always focused on them – but actually, deposits and savings in households have increased 6% year-on-year, and cash flows for many businesses again have also strengthened in the last year.
“What we haven’t yet got is investment in growth, and we still have quite a tight labour market with quite high wage inflation.”
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Why should countries invest in UK?
Mr Nunn praised Chancellor Rachel Reeves and Business Secretary Jonathan Reynolds for delivering a positive message about the UK’s prospects in Davos, where optimism about America has contrasted with gloom-consuming European prospects.
“The UK message here has been very positive,” he said. “We’ve got a sort of barbell going on, with colleagues in America being very positive post the inauguration of [Donald] Trump… while Europe is feeling quite negative in Davos, and the UK is building its own path really as a place that people want to invest.”
“The UK is well-placed, we think, relative to the rest of the world, but sentiment has been down in the last few months and people have been nervous about some of the changes that the chancellor made on taxes in the coming months.”
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Trump puts Davos delegates on notice
The Lloyds boss was sanguine about the impact of Mr Trump’s second term, saying what counts is what he does, rather than just what he says.
“He’s one of the most predictable politicians we track, what he did on Monday this week is exactly what he said he’d do,” he said. “So there’s no uncertainty, I think, about his priorities and what he sees as important for the US economy and the ‘US first’ mindset.
“The uncertainty has always been around the execution, if he does execute, to what extent and when. Our base case for this year is that Trump will be good for the US growth, it will probably slow down the global economy if he starts to apply tariffs.”
UK
Teenager living in ‘continuous pain’ after surgeon Dr Yaser Jabbar carried out ‘inappropriate’ operations
A 15-year-old boy who was operated on twice by a now unlicensed Great Ormond Street surgeon is living with “continuous” pain.
Finias Sandu has been told by an independent review the procedures he underwent on both his legs were “unacceptable” and “inappropriate” for his age.
The teenager from Essex was born with a condition that causes curved bones in his legs.
Aged seven, a reconstructive procedure was carried out on Finias’s left leg, lengthening the limb by 3.5cm.
A few years later, the same operation was carried out on his right leg which involved wearing an invasive and heavy metal frame for months.
He has now been told by independent experts these procedures should not have taken place and concerns have been raised over a lack of imaging being taken prior to the operations.
Yaser Jabbar rescinded his UK medical licence last year. Pic: LinkedIn
His doctor at London’s prestigious Great Ormond Street Hospital was former consultant orthopaedic surgeon Yaser Jabbar. Sky News has spoken to others he treated.
Mr Jabbar also did not arrange for updated scans or for relevant X-rays to be conducted ahead of the procedures.
The surgeries have been found to have caused Finias “harm” and left him in constant pain.
“The pain is there every day, every day I’m continuously in pain,” he told Sky News.
“It’s not something really sharp, although it does get to a certain point where it hurts quite a lot, but it’s always there. It just doesn’t leave, it’s a companion to me, just always there.”
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Finias’s surgery pictures
Care of over 700 patients being assessed
Mr Jabbar rescinded his UK medical licence in January last year after working at Great Ormond Street between 2017 and 2022.
The care of his 700-plus patients is being assessed, with some facing corrective surgery, among them Finias.
“Trusting somebody is hard to do, knowing what they have done to me physically and emotionally, you know, it’s just too much to comprehend for me,” he said.
“It wasn’t something just physically, like my leg pain and everything else. It was emotionally, because I put my trust in that specific doctor. My parents and I don’t really understand the more scientific terms, we just went by what he said.”
Doctors refused to treat Finias because of his surgeries
Finias and his family relocated to their native Romania soon after the reconstructive frame was removed from his right leg in the summer of 2021.
The pain worsened and they sought advice from doctors in Romania, who refused to treat Finias because of the impact of his surgeries.
Dozens of families seeking legal claims
His mother Cornelia Sandu is “furious” and feels her trust in the hospital has been shattered. They are now among dozens of families seeking legal claims.
Cyrus Plaza from Hudgell Solicitors is representing the family. He said: “In cases where it has been identified that harm was caused, we want to see Great Ormond Street Hospital agreeing to pay interim payments of compensation for the children, so that if they need therapy or treatment now, they can access it.”
Finias is accessing therapy and mental health support as he prepares for corrective surgery later in the year.
A spokesperson for Great Ormond Street Hospital told Sky News: “We are deeply sorry to Finias and his family, and all the patients and families who have been impacted.
“We want every patient and family who comes to our hospital to feel safe and cared for. We will always discuss concerns families may have and, where they submit claims, we will work to ensure the legal process can be resolved as quickly as possible.”
Finias with his mother and sister
Service not ‘safe for patients’
Sky News has attempted to contact Mr Jabbar.
An external review into the wider orthopaedic department at the hospital began in September 2022.
It was commissioned after the Royal College of Surgeons warned the hospital’s lower limb reconstruction service was not “safe for patients or adequate to meet demand”.
The investigation is expected to be completed by the end of the year.
Sir Keir Starmer has said closer ties with the EU will be good for the UK’s jobs, bills and borders ahead of a summit where he could announce a deal with the bloc.
The government is set to host EU leaders in London on Monday as part of its efforts to “reset” relations post-Brexit.
A deal granting the UK access to a major EU defence fund could be on the table, according to reports – but disagreements over a youth mobility scheme and fishing rights could prove to be a stumbling block.
The prime minister has appeared to signal a youth mobility deal could be possible, telling The Times that while freedom of movement is a “red line”, youth mobility does not come under this.
His comment comes after Kaja Kallas, the EU’s high representative for foreign affairs, said on Friday work on a defence deal was progressing but “we’re not there yet”.
Sir Keir met European Commission president Ursula von der Leyen later that day while at a summit in Albania.
Ursula von der Leyen and Sir Keir had a brief meeting earlier this week. Pic: PA
If agreed, the deal will be the third in two weeks, following trade agreements with India and the US.
Sir Keir said: “First India, then the United States – in the last two weeks alone that’s jobs saved, faster growth and wages rising.
“More money in the pockets of British working people, achieved through striking deals not striking poses.
“Tomorrow, we take another step forward, with yet more benefits for the United Kingdom as the result of a strengthened partnership with the European Union.”
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Conservative leader Kemi Badenoch has said she is “worried” about what the PM might have negotiated.
Ms Badenoch – who has promised to rip up the deal with the EU if it breaches her red lines on Brexit – said: “Labour should have used this review of our EU trade deal to secure new wins for Britain, such as an EU-wide agreement on Brits using e-gates on the continent.
“Instead, it sounds like we’re giving away our fishing quotas, becoming a rule-taker from Brussels once again and getting free movement by the back door. This isn’t a reset, it’s a surrender.”
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