IMF warns Britain over its membership in EU

The IMF has sounded a warning for Britain over its housing market and uncertainty surrounding future membership of the EU.

The UK economy is on the right track, but the uncertainty surrounding a referendum on Europe could cast a shadow on the country’s economic future, the International Monetary Fund said today.

Publishing its annual health-check of Britain, the IMF also expressed some concerns about rising house prices, housing shortage and the ‘strikingly large’ UK current account deficit.

It said this left the country exposed to a loss of confidence from foreign investors and high levels of household debt.

Christine Lagarde, the managing director of the IMF, said that in her personal view she 'very, very much' hoped that the UK would vote to remain in Europe and that a referendum should be held sooner rather than later.

As for housing, the IMF said that there was ‘clearly need for more’ and that the Bank of England might need to impose tougher checks on mortgage lending if the amount of higher-leverage mortgages do not continue to fall.

Lagarde said: ‘House prices are still growing faster and higher than income grows.

Sources: MENA