The value of properties in England and Wales is said to have fallen for the months of May, with house prices declines of 0.2% compared to April, taking the annual house price rate of decline to 15.9%. The figures were released by the Land Registry, who also report that the average house price has now fallen to £152,497.

In March and April the year on year drop that was recorded came in at 16.2% so the annual rate of decline has fallen slightly for the month of May. The report from the Land Registry comes on the back of another recent report released by the Council of Mortgage Lenders, which claimed that the level of mortgage lending across the UK for May had fallen.

Whilst all regions of England are said to have seen house prices fall over the months of May the hardest hit area seems to have been the North East, where house prices fell by around 17.2%, which was significantly higher than the average house prices drop. The biggest month on month fall was also seen in this area, with house prices in May for the North East around 4.3% lower than in April.

The report from the Land Registry also included other data, some of which related to activity within the housing market. The figures showed that between December of last year and March of this year there were just over 31,000 property transactions, and this stood at just half of the number of property transactions seen over the same period last year.

There have been a number of reports recently that have suggested that the property and mortgage markets may be stabilising with a variety of encouraging figures and statistics having been released recently. One official from the Royal Institute of Chartered Surveyors said that the Land Registry report and data offered further indication that there could be increasing stability within the property market. This is due to the easing of the annual rate of decline in house prices across England and Wales.

It has been revealed recently that pay increases in the jobs market across the UK are now suffering badly as a result of the ongoing recession, as employer cutbacks results in pay deals hitting their lowest levels in nearly forty years. A report from the Industrial Relations Services showed that more and more firms were freezing pay in a bid to cut costs, with the median pay rise in the three months to the end of May coming in at just 1.3%.

This was the same as the revised figure for April, and according to the Industrial Relations Service is the lowest since it started collating data on pay rises back in 1971. In the current economic downturn thousands of jobs have been shed across the UK over recent months, with unemployment rates rising to their highest level in over a decade. Some companies have even asked employees to take unpaid leave to help out with the financial situation, or asked them to work for free, one such firm being British Airways.

The data for May showed that there were two hundred and thirty two pay awards, and out of these 35% were either pay cuts or pay freezes. This reflected a small increase from the 32% seen in the April data. A massive 81% of pay rises were shown to be lower than the same period in 2008, with 11% remaining the same, and just 8% being higher than last year.

A spokesperson for IRS said that whilst pay deals were unlikely to turn negative the impact of the recession on pay deals was very clear from the recent figures. The data shows that private sector pay deals are the ones that are suffering most, with pay deals within the public sector said to be holding up well even in the current financial and economic climate.

In the meantime, recent reports have suggested that there has been a slowdown in rising unemployment, which some have said could indicate an improvement in the economy. However, most experts have said that it is too early to jump to any conclusions and that the full impact of job losses over more recent months may not yet have been felt.

It has been reported that the UK’s financial regulator, the Financial Services Authority, is set to put an end to all commission based financial advice, which will ultimately change the way in which financial products in the UK are sold to consumers. This move is part of an overhaul of the financial sector by the regulator.

The plans were outlined in the FSA’s Retail Distribution Review, and the measures are likely to have a huge impact on many financial services providers. This is because it will mean that they can no longer earn commission on a variety of financial products, such as investment funds, life assurance, and pensions. The changes have been provisionally scheduled to take place in 2012.

One official from the FSA said that the measures were being taken in a bid to try and rebuild consumer confidence following the last couple of years, which have been particularly turbulent in the financial sectors. He added that a more sustainable sector needed to be created, and that something needed to be done to help consumers get access to the advice that they needed quickly and effectively. He said that this was now more important than ever before.

At present the proposals over ending commission based financial advice are still open for consultation, and will remain so until later on this year. One of the major issues that the proposal aims to address is the issue of commission based mis-selling, where consumers may end up receiving poor or unsuitable advice by an industry professional that is commission based. This is due to concerns over advisors recommending products based on the amount of commission they will receive rather than on which product is best for the consumer.

At present around 80% of payments to independent advisors comes via commission rather than from a fee from the consumer, and in many cases the consumer does not realise that the advisor is getting commission, and assumes that the advice is simply free. The new regulations will stop financial groups from offering commission to advisors in order to get recommendations.

The Office of Fair Trading has recently announced that no matter what the outcome of the House of Lords appeal regarding bank charges, it still aims to fight these banks charges and brand them as unfair, even if the banking industry wins the appeal The court battle between the banking industry and the Office of Fair Trading has been raging for around a year and a half now, and has still not been conclusively resolved.

In original rulings the OFT, which had branded these bank charges as unfair and unlawful, was given the go ahead to investigate the terms and conditions of banks, which also included looking into these bank charges. However, the banks appealed against the decision, and whilst the original ruling was upheld in favour of the OFT the banks also appealed against this, and the case has ended up at the House of Lords.

Whilst the OFT has said that even if the appeal goes in favour of the banks it will still pursue these charges as unfair, a lawyer working on behalf of the banks described the OFT as being part of a ‘developing saga’ adding that this had ‘no basis in law’.

However, the OFT has stated that the concerns of the watchdog are not just related to the issue of the bank charges. There are also concerns over how the practices used with regards to bank accounts and charges. One official from the OFT said that these concerns centred around the amounts that the banks were charging as well as to the fact that customers had not truly agreed to pay these charges.

The watchdog also said that customers were being put in a difficult position both when they signed up to a bank account, and when they made a mistake that resulted in overdraft fees being clocked up on their account. Some of the problems that were highlighted by the OFT included the fact that most customers do not study the terms and conditions of these accounts, that customers cannot determine whether the account fees will hit their account, and that customers had no facility to opt out of the contract with their banks.

The governor of the Bank of England, Mervyn King, has said that clearer goals need to be set with regards to cutting deficits, adding that the government needs to show ‘greater ambition’ when it comes to reducing public borrowing levels. He said that whilst the Budget did include measures to try and cut deficits the plans were not clear enough.

Mr King went on to say that whilst there was a lot of speculation with regards to a speedier recovery for the UK’s economy he was now ‘more uncertain than ever’ about the economy making a faster than anticipated recovery. King was speaking when he, and other members of the central bank, appeared before the Treasury Select Committee recently.

The speed at which deficits would be cut would depend partly on how quickly the UK’s economy started to make a recovery, according to the governor. He described the scale of the deficit as ‘extraordinary’ and said that the level of the deficit reflected the seriousness of the global downturn. He added that it also showed that this showed that fiscal policy had not been sustainable when we entered the global crisis.

Mr King told the Treasury Select Committee that a plan would have to be put into place for the lifetime of the next parliament to demonstrate just how these deficits will be reduced to the levels seen before the economic and financial crisis. According to reports Mr King also said that the Chancellor of the Exchequer was feeling the strain, and despite reports of clashes of opinion between himself and Darling he added: “I don’t think the chancellor is remotely relaxed.”

During his speech to the Treasury Select Committee, where he and other Bank of England officials were giving evidence on the banking crisis and the latest inflation report, King also said that it was currently too early to predict just how quickly the UK’s economy would start seeing any significant improvement and recovery. He said that there were ‘genuine concerns’ over the speed of the recovery, and added that businesses were still finding it difficult to access credit from banks in the current climate.

The British Banker’s Association has reported that the number of new mortgage loans for May rose to its highest level in around thirteen months, indicating that lenders may be relaxing their lending criteria to some degree and allowing more people to take out mortgage loans to purchase property.

The figures from the BBA showed that approval was given to 31,162 mortgage applications for the month of May, and this was the highest number of approvals since the early part of last year. The news comes on the back of a spate of other encouraging figures that have reflected improvement in the mortgage markets, property markets, and the economy in general over recent weeks.

The number of mortgage application approvals for the months of May was around 7% higher than in April according to the BBA data. However, whilst the number of new mortgage approvals for the month of May did increase, there was an overall drop in the amount of money that lenders advanced to buyers for the month. Net lending levels have now fallen for the third month in a row, with advances falling to their lowest level since 2001.

The statistics director from the BBA said that although the figures relating the number of mortgage approvals was seen as encouraging the wider picture for the mortgage sector still looked somewhat bleak due to the drop in the level of net mortgage lending. The BBA added that there had been a drop in the level of homeowners that were refinancing, which had dropped by around 60% compared to the same period last year.

The BBA went on to state that consumers’ appetite for borrowing at the current time was still weak, and this was as a result of worries over household finances and jobs in the current economic climate. The group added that spending on credit cards was down compared to the same period last year. Like a number of other industry officials one mortgage broker stated that some level of stability did appear to be returning to the mortgage market, but that it would be unwise to read too much into this at the current time.

The Council of Mortgage Lenders has recently announced that it has changed its forecasts in relation to repossession levels in the UK over the course of this year, revising the figures downwards. The announcement comes amidst a range of recently released reports that have shown encouraging data with regards to improvement in the economy. The latest figures from the CML have suggested that the number of homes that will be repossessed over the course of this year may not be as high as originally predicted, providing more welcome news for the nation.

In December of last year the CML predicted that over the course of this year around 75,000 homeowners would lose their homes through repossession. However, it has now changed this figure and is now estimating that the number of repossessions that will take place over 2009 will be closer to the 65,000 mark, which is ten thousand lower than its original prediction.

Whilst the new prediction from the CML is significantly lower than the original one, it will still mark an increase of around 25,000 repossessions compared to last year, with 2008 seeing repossession levels standing at 40,000. Officials from the CML also added that although it had revised its forecasts with regards to repossession figures it was not prepared to speculate about any recovery in the UK’s housing market, as it was too early to jump to any conclusions as yet.

The agency also did not make any predictions with regards to increases in house prices over the course of this year, but it stated that for the immediate future activity within the housing market was likely to remain subdued. There are also concerns from the CML with regards to increases in mortgage arrears over this year, which could result from increased job losses and could see the level of arrears double compared to last year. By the end of the year the CML has predicted that around 360,000 mortgage holders will be in significant arrears, and this compares to 182,600 in serious arrears at the end of last year.

Whilst many consumers may think that their energy bills have rocketed over the past few years, industry experts have warned that there could yet be far worse to come, and it has been estimated that over the next decade energy bills could increase to as much as £5,000 a year. There are concerns that millions of households could be plunged into fuel poverty over the coming years, with energy prices expected to jump by a massive 42% a year.

Officials have calculated that over the past five years energy bills have doubled for the average household, with the annual energy bill rising from £580 a year five years ago to £1243 now. However, the average annual energy bill is set to quadruple by 2020, according to reports, with the average annual energy bill leaping to around £5,000 a year.

Part of the reason behind the expected huge increases is the fact that Britain is trying to bring in greener energy policies, and this would mean replacing the existing infrastructure to support these green policies. There is also the problem of Britain being dependent on gas from Eastern Europe, which results in a loss of control over costs and energy markets. Some experts have also predicted that demand for power in China and India will increase largely once the recession is over, and this will push global energy costs even higher.

One industry professional said that whilst the £5,000 a year bills may seem like a worst case scenario the expected surge in energy costs meant that households would have to do their best to cope with these price hikes and would have to adapt their lifestyles in line with this. Energy companies are expected to require millions of pounds to update their systems and improve their infrastructure, and they are feeling the pressure of being expected to invest in green energy.

Annual bills are expected to rise steadily over the coming years, reaching averages of over £3,500 in 2017, and rising to nearly £5,200 by 2019. However, they are then expected to fall slightly, leaving the average household energy bills at around £5,000 by 2020.

According to a recent report the average rate of interest on a fixed rate mortgage deal in the UK has jumped over the past week, with new borrowers being faced with far higher fixed rates even though the base interest rate still stands at its lowest level in the history of the Bank of England at just 0.5%.

One industry group has claimed that there has been a big jump in the interest rates being charged to new customers looking for fixed rate deals with many rates going up by 0.16% over the past week, bringing the average rate of interest charged on a fixed rate mortgage to 4.9%. This is the average increase on a two year fixed rate deal, but the increase on a five year fixed rate mortgage deal has increased even further, by around 0.21% since the start of last week.

The higher cost of interbank lending is thought to be behind the increase in average fixed rates on mortgages, and last week saw average fixed rates experience their biggest increase since June of last year. Industry officials have said that there has been a period of calm within the mortgage market for a short while, but that this was the calm before the storm before mortgage lenders suddenly started falling over one another to try and increase their rates on fixed rate mortgage products.

However, officials also expressed concern over the situation stating that lenders were always very quick to pass on the increases in the cost of wholesale money market funding, but were usually slow to pass on any decreases in this area to consumers. So far, a large number of lenders have already increased their fixed rate offerings in the mortgage market, and some industry experts have predicted that this is a trend that is likely to continue.

In the meantime, mortgage brokers and industry experts have suggested that consumers that are looking to apply for a first time fixed rate mortgages, or those that are currently coming of special deals and hoping to refinance to a low cost fixed rate mortgage whilst the base rte is low, should act quickly before the actions of many mortgage lenders make it impossible for them to get an affordable deal.

Over recent weeks there have been mixed reports with regards to the state of the economy in the UK. A range of recently released data has indicated that the economy may be on the verge of improving, with data that has shown a fall in the rate of increase of jobless and unemployment claimants, and further reports that have shown that there was an increase in GDP in both April and May, leading some to predict that the end of the recession could be in sight.

However, there have also been a number of industry groups and officials who have made it clear that it would be wrong to jump to any conclusions with regards to the state of the economy, with some stating that the economy still has a long way to go before any signs of real recovery will be seen, and others stating economic contraction still hadn’t fully fed through, which could mean further problems as the year goes on.

The governor of the Bank of England, Mervyn King, has recently voiced his opinions on the UK’s economy, and has echoed those of groups such as the Confederation of British Industry, which recently stated that people should not get their hopes up for a fast recovery, as improvement was unlikely to be seen until next year.

In a recent newspaper interview Mervyn King told reporters that it was too early to come to any solid conclusions with regards to the economy. He said that the various data that had been released over recent weeks did show signs of the economy easing off to some degree, but he added that he didn’t think that anybody ’should draw strong conclusions.’

Mr King is also said to have noted a significant drop in confidence levels as a result of the ongoing recession. He said that it was impossible to regain this confidence quickly, and this meant that coming out of the recession would take a lot longer than falling into recession. He added that it would not be a sensible move for anyone to expect activity, which had fallen markedly over the past six months, to pick up quickly and suddenly.

Amidst a variety of reports that have claimed that the recession may be coming to an end it has recently emerged that the level of unemployment increases has also slowed down, fuelling further speculation that the UK could pull itself out of recession this year. Figures have been released by the Office for National Statistics, and showed that unemployment increased to 7.2% compared to 5.3% a year ago. Industry experts had been expecting the level of unemployment to increase to at least 7.3%.

In the three months leading to April the number of unemployed increased to 2.26 million, and based on measurements from the International Labour Organisation this was the highest it had been since 1996, before the Labour Party even came into power. The measure used by the International Labour Organisation includes taking into account both those claiming benefits and those actively looking for work. It was revealed that the increase in claimants was also lower than many industry experts had been expecting.

The number of people that were claiming unemployment benefits for May came in at 1.54 million, which was an increase of 39,300. However, the increase was smaller than that seen in April, which was 49,600, and was far lower than the increases that had been forecast, which came in at between 60,000 and 65,000. The sharpest rise in the numbers of people claiming unemployment benefit during the recession was seen in February, when the number of claimants increased by 136,600.

One analyst said that whilst the figures were encouraging unemployment levels probably still had quite a way to go yet. He said that the economy did appear to have stabilised temporarily, but added that the effects of economic contraction that was seen at the end of last year and the start of this year still had to feed through to the jobs market, which could mean a considerable number of job losses over the coming months.

He predicted that by the end of next year unemployment levels would peak at around three million, and whilst this was high it was a vast improvement on previous predictions that forecast 3.3 million unemployed by the end of 2010.

It has recently been reported that many younger people have seen their aspirations of owning their own home affected because of the recession. A survey was recently carried out that indicated that the recession had resulted in a profound impact on the home ownership hopes of many consumers.

The results of the survey found that over the past year the number of younger consumers that thought that owning their own home was the ‘ideal living situation’ had dropped. Over two thousand people were polled as part of the survey, which was carried out by the Chartered Institute of Housing. The institute is looking for both renting and home ownership to be considered equally viable choices for younger consumers.

An official from the CIH said that many younger people were under the impression that home ownership was the only viable option for them, and that the reason for this was because they had not been given enough information about the alternatives that were available to them. The results of the poll showed that over 70% of those polled thought that home ownership was the ideal option.

However, the results of the poll also showed that amongst younger people aged between 25-34, the number of people that thought that owning their own home was the perfect living situation to be in had fallen significantly, dropping from 83% just a year ago to around 69% now. Negative equity was one of the main areas of concern amongst those polled, which included homeowners, tenants, and those living in social housing such as housing association properties.

Some of the people polled believed that home ownership provided a greater degree of security in terms of the fact that the homeowner could not be evicted, offered more security, and boasted a better status for homeowners. However, those that do fall behind on their mortgage repayments in the current climate still face the risk of having their property repossessed and losing their homes.

A separate report that was recently released showed that there had not only been an increase in the number of consumers that were looking for debt related advice over recent months, but also that there had been a demand in the number of people that were looking for rented accommodation. The gap between asking and selling prices is also said to have decreased according to the Royal Institute of Chartered Surveyors.

Despite various optimistic predictions from a range of agencies and industry groups, the Confederation of British Industry has recently announced that the UK’s economy is likely to experience a slow recovery, and will not see any real level of growth before the start of 2010. This comes despite conflicting reports from other agencies that the economy has already grown over the past couple of months and could start to see significant recovery over the course of this year.

Officials from the CBI said that some industry experts had been too quick to make predictions based on figures that suggested that recovery could come earlier than many had expected. The predictions from the CBI are far less optimistic than many others that have been made recently, with officials from the group not only stating that recovery is unlikely until next year but also that the levels of recovery could be bleak, with a predictions of just 0.3% growth at most over the first half of 2010.

There was a far more optimist report released last week by the National Institute of Economic and Social Research, which based early economic growth on recently released data that showed some level of growth over the past couple of months. Whilst the CBI does not agree with this optimistic view from the National Institute of Economic and Social Research it does think that at the end of the recession the economy will not have shrunk to the same level that it did in the recession of the late 1980s and early 1990s.

One spokesperson from the CBI said that the UK would soon be ready to go through a period of stabilisation before it started to experience any real level of recovery. He added that economic growth was likely to be very gradual and slow, with business trends still being strongly affected by tight credit conditions. He also said that lenders’ confidence needed to increase to a point where they started lending again for proper recovery to begin. Another CBI spokesperson stated that consumers still had a tough period to get through with lower income levels impacting on the amount of money that they have available to spend.

The Prime Minister, Gordon Brown, has been slated by politicians in Northern Ireland over his failure to keep promises involving compensating savers who have lost their money as a result of the collapse of a financial institution. It is estimates that around nine and a half thousand savers have lost their money as a result of the collapse of the Presbyterian Mutual Society seven months ago, but despite his promises the PM has filed to compensate any of them.

Earlier this year the Prime Minister said that savings protection would be offered when any UK financial institution ran into trouble. However, with regards to those that were with the Presbyterian Mutual Society the government is now claiming that they were not savers but actually investors who had shares in the financial institution. However, one Northern Ireland MP, Jeffrey Donaldson, said that this view was not acceptable.

Donaldson stated that the Presbyterian Mutual Society was on the same footing as other UK building societies that have received government assistance. He said that it was unfair for UK citizens living in Northern Ireland to hear that the Prime Minister had promised to protect their savings but had then failed to do so.

He also went on to state that the First and Deputy First Ministers had arranged a meeting with Gordon Brown in order to discuss the collapse of the financial institution. He said that the aim of the meeting was to ensure that the PM stuck to his promise of compensating all UK savers after the collapse of a financial institution. He said that some people had sold their businesses to put money into the Presbyterian Mutual Society and others were in care homes with their money frozen causing them untold worry and financial difficulties.

Donaldson added that it was the responsibility of the government in the UK to compensate these savers that had lost out, and not the responsibility of the Northern Ireland Assembly. He finished by stating that the Secretary of State had promised to intervene in the situation, and that he was now waiting to see what happened.

In the current financial climate, with the country still in recession, an increasing number of consumers may be tempted to buy cheap counterfeit goods such as electrical products, toys, and even medicines. However, officials from Trading Standards have released a warning urging consumers not to give in to temptation and purchase these fake goods, as they could be a waste of money and could even prove to be dangerous.

Trading Standards is concerned that in the midst of the recession more and more people may turn to cheaper counterfeit goods because they simply cannot afford to buy the real thing. According to figures released by the group the counterfeit market now accounts for around 15% of world trade. Last year around £30 million worth of fake electrical goods came into the UK.

One officer from Trading Standards said that whilst people may think that there is no harm in buying things such as fake designer watches and clothes, and knock off DVDs and CDs, they needed to remember that there could be real dangers posed if they purchase counterfeit products such as toys, medicines, and electrical products. He added that buying these products could put at risk the health of children and adults, and could also put the home at risk.

Trading Standards went on to state that in some cases fake goods such as medicines, toys, and electrical items were faulty or substandard to the point where they have actually caused fatalities. Over recent years the counterfeit goods market has been growing, and it is thought that since the country slid into recession there has been an increase in the number of people that have been trying to get their hands on fake products at rock bottom prices.

A number of warnings have already been issued to consumers with regards to fake medicines, which many people have purchased online only to find that they are ineffective and sometimes dangerous imitations of the real medicine. Many have also fallen for electrical items such as fake hair straighteners, which authorities warned could cause serious burns and damage hair.

When the UK officially slid into recession last year the Chancellor of the Exchequer, Alistair Darling, predicted that it would only last until the middle of this year before the nation starting coming out of recession. This prediction was greeted with extreme cynicism from many industry experts, who thought that the recession could go on well into 2010 and even beyond.

However, according to a recent report released by the National Institute of Economics and Social Research the chancellor may have been correct in his original prediction. The institute claims that the country may be coming out of recession, with both April and May having seen periods of economic growth. April is said to have seen the first period of growth in the economy for around one year, and this growth is said to have continued in May.

The report went on to state that the economy hit its lowest point in March, although the economy did shrink by 0.9% in the three months to May compared with the previous three months. The figures used by the National Institute of Economics and Social Research were gathered from both the Office for National Statistics and from private sector surveys.

The figures on the report showed that in April GDP grew by a monthly rate of 0.2%, and in May by a monthly rate of 0.1%. Officials have now said that Britain could become the first major economy to drag itself out of recession if the growth trend continues. Other data showed that growth has returned to the manufacturing sector, brining fresh hope for the nation, which has been plunged into economic gloom for the past year.

However, one member of the Monetary Policy Committee, Kate Barker, warned against becoming too optimistic too quickly about the slew of encouraging figures that have been released recently. She said that it was important that the country waited to see whether the trend continued into the autumn. The National Institute of Economic and Social Research is more optimistic, stating: ‘The monthly profile points to March as having been the trough of the depression, with output rising in April and May. The monthly figures are inevitably erratic but the picture is coherent with the broader picture of stabilisation which has emerged.’

It has been reported that house prices in the UK may be stabilising as a result of increased interest from buyers coupled with a reduction in the number of people looking to sell their homes. According to surveyors from the Royal Institute of Chartered Surveyors the level of interest in the property market from potential buyers has now increased for the seventh month in a row.

A survey that was carried out by RICS showed that over the past two years there has been a continuing trend where there are fewer sellers putting their properties on the market. There have also been a number of surveys, including a government survey, that have shown an increase in property prices over the past couple of months.

RICS has been carrying out this survey for many years, having started in 1978, and the purpose of it is to gauge consumer confidence in the property market based on feedback from surveyors and estate agents from around the country. The results of the latest survey showed that the average property sales levels were at the highest since August of last year, and buyer interest was continuing to rise after a number of very turbulent months.

Whilst property sales levels have been rising over recent months the figure is still down by just over 30% compared to the same period last year. The increase in the number of would be buyers showing an interest in the property market was seen more in Scotland, London, and the South East of England compared to other areas. House prices are being supported by this increased interest according to officials, as well as by the falling number of properties that are coming onto the market.

A spokesperson from RICS said that the housing market looked to be close to bottoming out based on the survey results and other recent figures. He added that the fact that prices were now starting to stabilise was as much to do with the lack of properties coming onto the market as the rising number of people showing interest in the property market.

After a particularly worrying summer, when many motorists were already struggling to make ends meet, sky high petrol prices eventually started to come down again last summer after a period of hikes resulting from high oil prices. Over the summer of last year the high cost of petrol resulted in many cash strapped consumers having to tighten their belts even further, and even led to many taking the decision to stop using their cars wherever possible because of the high cost of petrol.

Many people were relieved when it the autumn of last year petrol prices started to come down again, but sadly the price reductions have been relatively short lived, with recent reports claims that the cost of petrol is due to rise once again, and that the price per litre could go as high as £1.15. For the many people that are already struggling in the current climate due to the financial crisis and the recession, this will come as very bad news.

Analysts have warned that the price per litre of petrol could reach the £1.15 mark within the next few months. Experts have added that once prices have started to rise they will continue to increase steadily. Industry officials have said that the rising cost of crude oil has resulted in these petrol price increases, counteracting the record levels of price deflation that consumers have been enjoying over recent weeks.

Already, the average cost per litre of petrol has increase of over £1, and if the current trend continues these prices will continue to rise, leading to prices per litre that could exceed the £1.15 mark, putting further strain on household finances for the many consumers that are already struggling to make ends meet.

In some areas the cost of petrol per litre has already soared to over £1.10, and this is set to go even higher if crude oil prices continue to increase. One area of Kensington is now charging close to £1.40 per litre of petrol. In January the price of petrol at its lowest point fell to just over eighty six pence per litre for petrol and just under ninety nine pence per litre for diesel.

The British and Dutch governments have recently revealed that Iceland has agreed to reimburse them to the tune of over £2 billion following the collapse of the Icelandic banking system last year and its subsequent nationalisation. Following the collapse of popular Icelandic banks last year many UK customers saw their life savings wiped out, and the UK government ended up loaning Iceland £2.3 billion so that many of these savers could be reimbursed.

Over the past couple of years a number of Icelandic savings accounts have been launched onto the UK market, and with the eye-catching rates of interest that they were paying to customers they quickly shot to the top of the best buy tables as an increasing number of UK savers flocked to put their money into the accounts and benefit from the high returns that were on offer.

However, things went sour last year when the Icelandic banking system collapsed and savers that had their hard earned cash in Icesave accounts lost their savings. At this point the UK government had to step in and pay out over £2 billion to reimburse eligible savers after Iceland failed to make provisions to pay back those that had lost their money.

The accounts of around 300,000 retail depositors who had Icesave accounts in Britain were affected by the banking collapse, according to reports. Amidst high tension between the British and Icelandic governments the UK treasury stepped in to provide full reimbursement to those that had lost money in British Icesave accounts.

Negotiations have since been ongoing between the two nations, and Iceland has now agreed to repay the £2.3 billion that was used to reimburse these customers, as well as interest on top. Government officials in the UK have seen the step as a step forward in rebuilding relations between the two nations. One Treasury spokesperson said that the move was good news for both Iceland and for taxpayers in the UK.

However, this agreement does only relate to retail deposits at present, which means that local authorities and some other agencies and bodies will have to wait it out and see if they eventually get their money back.

Figures have shown that the average rate of interest charged on credit cards in the UK has soared to 18%, taking it to the highest level on record. This is despite the fact that the base interest rate is at its lowest level on record, standing at just 0.5% after a series of dramatic cuts since October of last year.

With an increasing number of credit card customers unable to repay their credit card debt in the current financial climate credit card firms are looking for ways to try and claw back this lost revenue, and some industry experts have claimed that one of the ways in which they are doing this is by hiking up the interest rates for customers that are paying their debt, leaving them facing far higher repayments and resulting in them paying far more for their borrowing.

The recession is likely to bring an increase in unemployment levels, which have already shot up over recent months, and an increase in repossessions, and this is set to make the situation even worse, with a growing number of people finding themselves unable to meet their repayments. Whilst this could mean that credit card firms increase rates even further some industry officials think that this could be their undoing, as it will result in a greater number of people being unable to make their repayments due to the sudden hike in rates and interest payments.

The average rate of interest charged on credit card purchases has now gone up to 18.1% according to recent figures, and this was up from 17.9% last month and from 16.3% two years ago when the base interest rate was more than ten times what it is today. Credit card providers have also been finding other ways to extract more money from customers, and this includes higher fees and interest rates for cash transactions and withdrawals made on the card, and higher usage fees for using the credit card abroad.

One finance industry specialist said that the effects of the ongoing recession had seen many people unable to meet their financial commitments, resulting in huge losses for credit card companies, and the cost of these losses was now being passed on through higher interest rates to other customers.

The base interest rate has been left unchanged for the third month in a row following today’s Monetary Policy Committee meeting. Whilst there has been no change to the base rate for a third month it still stands at its lowest in the history of the Bank of England, at 0.5%. The Bank of England announced its decision after today’s meeting, but did not announce any further actions that it was planning to take in a bid to boost the economy.

Policymakers are facing the tough job of trying to assess economic decisions, which many say have been showing slight signs of recovery. Some have taken recently released reports and data as a sign that the economy is set to recover faster than had originally been thought, although this is not a view that has been shared by all industry experts.

There has been some good news on the horizon of late compared to the bleak figures that have been hitting the headlines over recent months. For example, May saw house prices increase by 2.6% compared with April, and the number of mortgages that have been approved for property purchases has been rising.

However, despite this encouraging data the Bank of England has indicated that there is still much uncertainty about the economic future, which was reflected in its recently released Inflation Report. Last month the central bank announced that it was pumping a further £50 billion into the economy through quantitative easing, having already committed £75 billion through this process. Industry groups are now calling for a further increase in the amount of money that the Bank of England is going to inject into the economy through QE.

An economist at the British Chambers of Commerce said that people should not allow themselves to be lulled into a false sense of security, and he added that with unemployment continuing to rise and investment levels being slashed the government had to make tackling the recession its number on priority. Other experts have voiced concerns that whilst the low base rate is now helping many borrowers it is causing severe financial problems for many savers, who are receiving minimal returns on their money.

Many consumers in the UK are confused with regards to how long it takes for a cheque to clear, and recent research has showed that it is little wonder given the fact that many bank employees don’t even know about timescales for cheque clearance. A UK watchdog has stated that consumers are often being given information that is ‘confusing and inconsistent’ by employees at banks when it comes to cheque clearance times.

A spokesperson from the Banking Code Standards Board said that training had not been effective, and many employees were giving out the wrong information on this matter whilst looking confident about the information they were giving out. The problems relating to this lack of knowledge amongst banking employees was brought to light after a mystery shopping exercise was carried out.

A similar survey was carried out by the Banking Code Standards Board around a year ago, but unfortunately things have gone downhill rather than showing improvement, with the results for this latest survey being worse that those seen in the survey carried out last year. It takes six days for a cheque to clear with complete clarity, at which point the accountholder can be confident that it will not bounce, but many bank employees did not appear to know this.

The results of the survey showed that a massive two thirds of employees in both banks and building societies were not aware that after the six day period a cheque could not bounce. With many consumers already confused about cheque clearance times this raises concerns about the quality of information being given by banking staff.

On a better note, banking employees did have a better knowledge of some of the other regulations that were tested as part of the survey. The results showed that 42% of employees knew that interest must be credited no more than two days after the cheque has been paid into the account, and 50% knew that the maximum number of days the accountholder had to wait before being able to access the funds from the cheque was four days.

Despite the ongoing gloom that comes with the recession that has gripped the UK over recent months, a number of industry officials have predicted that the economy could turnaround and start to enjoy growth again by the end of this year, with industry figures showing signs of improvement in industry. The figures have prompted officials to predict that industry could pull itself out of recession by the end of the year.

The neutral point of the activity index from the Chartered Institute of Purchasing and Supplies (CIPS) stand at 50 in terms of its score, and in April of this year the reading was 43.1. However, there was an improvement seen in May, with the reading coming in at 45.4. Experts have said that if growth continues over the coming months and the reading goes above the neutral point of 50, this will be a positive sign that the economy is starting to grow again.

Following the readings, CIPS has predicted that the decline of industry will turn around at some point this year, and stability in industry is expected by the autumn. One leading economist said that the figures made for encouraging reading, and renewed hopes that the state of the economy could start to look much brighter by the end of this year.

However, he did add that there could still be a long way to go for the economy and for industry, and that manufacturers still faced serious hurdles when it came to sustainable growth in the sector. The index from CIPS did fall to dismal lows earlier this year, but has been enjoying growth since that time, further fuelling speculation with regards to the recovery of industry and the economy.

Despite the encouraging figures from CIPS another contrasting report has recently been released by EEF, and this has suggested that the industry sector is unlikely to start recovering from the recession until the end of this year at the earliest, and most likely much later than this. In its report EEF concluded ‘There are big question marks about when we will see substantive signs of recovery in demand.’

It has been revealed that the same day bank transfer system that was launched around one year ago is still failing to give consumers the speed and service that they came to expect. Despite the launch of the scheme recent reports claim that around half of the payments that would be eligible for same day clearance are still taking three days or longer to go through.

The Faster Payments System was launched in May of last year, but according to recently released figures around £45 billion has failed to go through properly on this system. A number of banks and one building society are said to have failed to make progress in terms of implementing this faster clearance scheme, which as resulted in many consumers being let down with regards to speedier clearance.

Twelve banks and one building society are said to have signed up to the faster clearance scheme when it came into force last year, and the authority that is running the scheme has claimed that the scheme is working. This is despite figures obtained through recent research that indicate that in around 50 percent of cases the scheme is not actually working at all.

A number of the UK’s largest banks have been involved in the scheme, and this includes Lloyds TSB and Abbey amongst others. The building society that signed up to the scheme was Nationwide, which is the nation’s largest building society. Some of the banks involved have given their excuses for failing to conduct faster clearance to full capacity. For example, Abbey said that it had been forced to focus on merging technology with its founding bank, Santander, but hoped to have everything running smoothly by June of this year, which is over a year after the scheme was brought in.

APACS, the payment clearance agency in the UK, launched the scheme last year, and one senior official from the scheme insisted that it was working well on a day to day basis. However, she did add that customers that had walked away had done the right thing, as frustration was starting to set in.

Figures that were recently released by the British Banker’s Association have suggested that there could be increased signs of stability in the mortgage market after two particularly volatile and turbulent years. The figures showed that the annual rate of decline for mortgage approvals was at its slowest in almost two years, and officials from the BBA say that this could mean that the mortgage market is showing signs of increased stability.

The number of mortgage approvals for the purchase of a home increased from 26,671 in March to 27,685 in April. This was a decline of 15.5% on the year, and the BBA has said that this was the smallest annual decline since the onset of the credit crunch back in August of 2007. The data provides a more encouraging outlook for the mortgage market, which has suffered badly as a result of the credit crunch.

However, despite the BBA figures some analysts have warned that mortgage lending is likely to remain restricted in the near future, and therefore the recovery of the housing market was still quite a way off. Restrictions are likely to remain in place despite the base interest rate having fallen to record lows, and despite the fact that the government has been ploughing billions of pounds into the financial markets.

Other data has shown that house prices falls this year are at a slower pace than last year, and the low base interest rate has resulted in a greater number of prospective buyers showing interest in the housing market, but this has yet to equate into a significantly greater number of sales, as buyers struggle to get a mortgage or raise the deposit that they need to get onto the property ladder.

It is thought that there are a number of other factors that could affect a rise in housing activity, in addition to tight credit conditions, and this includes the higher rate of unemployment stemming from the recession and the concerns that millions of people may have about the security of their jobs at present.

Many UK workers aged over fifty are worried that the impact of the recession on their finances could mean that they end up having to work longer than they had planned to, throwing out their plans for retirement and a chance to relax and enjoy life to the full. Reports claim that many people in this age group are concerned because of the effect that the recession has had on their savings and investments.

The study was carried out by the elderly charities, Help the Aged and Age Concern, and the results revealed that nearly two thirds of workers aged over fifty were worried that they would have to shelve their plans for retirement and continue working in order to cope financially following the onset of the ongoing recession. Almost nine hundred and fifty respondents were polled and out of these 63% thought they would have to work longer than they had intended.

With the base interest rate in the UK having been slashed to its lowest level in the history of the Bank of England, remaining at just 0.5%, many older consumers that had been relying on their savings nest eggs to get their through retirement have seen the returns on their savings slashed. In addition to this volatility in the stock markets has also had an adverse effect on pension funds, spelling further bad news for those that were looking forward to retirement.

The results showed that compare to the beginning of this year 47% of respondents were more worried about their savings and pensions. With the economic downturn getting worse there has also been an increase in the number of workers aged over fifty being made redundant, which has resulted in an even bleaker outlook. The Office for National Statistics has shown that the number of redundancies amongst people aged fifty or over had increased by 47% over the past year.

An official from the charity said that the overall figures made gloomy reading for people within this age group, and that millions of people could be affected. Some face the prospect of being made redundant and then trying to get back into work at a late stage in their lives, whereas others fact the prospect of having to keep on working when they may have planned to retire.

With credit conditions the way that they are these days it is claimed that the old fashioned Hire Purchase system is coming back into fashion, with both lenders and consumers opting increasingly frequently for Hire Purchase, or HP as it is more commonly known. HP is known to be a simply system that provides benefit for both the finance company and the consumer, particularly in the current financial climate.

Figures have shown that the increase in popularity of HP has stemmed from the problems that have been created by the credit crunch. For lenders, HP has become a viable alternative because it means that the item purchased still belongs to the company until the customer has made payment in full, which provides greater security. Many consumers are also opting for this method of purchase as they are being more cautious about other forms of credit.

Whilst Hire Purchase was popular some years ago its popularity waned during the credit boom years, as more and more people turned to easily available loans and credit cards. However, with lenders being increasingly cautious about accepting consumers for finance such as credit cards and loans many have realised that HP could be their best option until credit conditions improve.

Finance companies are more likely to agree to HP finance, as it is lower in terms of risk, which makes things easier for consumers that are not able to get, or do not wish to take out, traditional loans and credit cards. The Finance and Leasing Association is set to release figures this week that will show there has been a 10% increase in the value of purchases made with HP between March of 2008 and March of this year.

In March of this year the value of purchases made on HP by consumers in the UK came to nearly £250 million, and this reflected a 25% increase compared to March of last year. Consumers have bought a wide range of items using HP, such as electrical items and home furnishings amongst other things.

Consumers in the UK are being urged to be careful when buying foreign currency to head abroad, after a number of cases were highlighted where people had purchased foreign currency only to find that some of the notes that they had been given were fake. A number of consumers have claimed that they have purchased foreign notes from UK Bureaux de Change, and that in some cases some of the notes have turned out to be fakes.

Those that were affected by the fake notes did not realise that there was a problem until they reached their destinations and tried to use the currency in shops, restaurants, and the like. The notes were promptly refused when they tried to make their purchases, and for some people this meant that their spending money was cut dramatically, as many of the notes that they had turned out to be fakes.

One man said that he ordered $1,100 from the Post Office online currency service. However, when he went to South America and tried to use the notes many were refused and turned out to be fakes. In total thirty two of the $20 notes that he had been given turned out to be fake, equating to $640 worth of fakes. Worse still, when he alerted that Post Office to the fakes and sent them back it was confirmed that the notes were fakes but no refund was offered.

He went on to state that there was no way that anyone else could have switched real notes for counterfeit ones whilst he had them, and therefore the fakes had to come from the Post Office when he initially ordered them. However, foreign currency providers in the UK have said that the fake notes are not coming from them, and that they have secure systems in place.

The Post Office has said that it is very careful to ensure that its foreign currency systems run smoothly, and that it gets its dollars directly from the US Federal Reserve via a partner. However, with the holiday season coming up consumers are warned to consider other forms of currency, such as traveller’s cheques, to avoid experiencing this problems when they go abroad and try to spend money.

In the current financial climate, and with the restrictions that have been placed on mortgage lending over the past year and a half, a rising number of people have been forced into renting a home rather than buying one. However, officials from one charity have said that many lettings agents across England and Wales are charging those that wish to rent a property excessive fees, and that this is driving up the cost of renting a home.

The Citizen’s Advice Bureau has recently released a report, which claims that many tenants are being hit with ‘unjustified and excessive’ charges from lettings agents across England and Wales, and that these charges could be adding as much as £600 to the cost of renting a property. Amongst the fees that these lettings agents are charging are administrative costs, credit reference check fees, and tenancy renewal costs.

Officials from the CAB have said that many of the charges and fees that the lettings agents are adding to the cost of renting a home actually bear no relation to the cost of the service that they are providing. The figures were partly put together from a survey of tenants that had contacted the charity for assistance, and the report was released just one week after the government announced a shake up of the industry stating that it wants a national register of private landlords in England and wants an independent regulator for lettings agents.

The CAB now wants any new regulations put into place by the government to include a ban on these excessive charges so that renting a home is made more affordable for tenants. The report claimed that many of the charges that were being added to rental costs were actually for services that should be a routine part of letting a property and not for services that were over and above the general work involved in letting a home.

The chief executive of the CAB said that these fees and charges were causing huge problems for people that were on low incomes and could not afford to get a mortgage and buy their own home. He accused some letting agents of just making up charges as they went along, adding that this was causing a huge barrier for many people.

Based on figures that have been released by the Office for National Statistics, April saw Consumer Price Inflation, or CPI, fall by more than expected on the back of falling costs. CPI fell to its lowest level in more than a year in April, with the annual rate of inflation falling from 2.9% in March to 2.3% for the month of April.

Many economists and analysts had been expecting CPI to fall to 2.4%, so the decline was sharper than expected. CPI has now fallen to its lowest level since January of 2008, and although it is still above the government target of 2% officials have said that the focus is now on trying to revive the economy, as inflation is expected to continue falling over the coming six months.

One economist said that the fall in CPI was encouraging, and over the next six months it was expected to continue declining sharply and could fall to below 1%. The ONS data showed that the sharper than expected decline was the result of falling gas and electricity costs, with many major suppliers having cut their prices, and declining food prices, with some food products now falling in price whereas a year ago they had been rising.

Another economist said that sterling was starting to recover slightly from oversold levels, and inflation was now moderating. He added that there was now far greater scope for CPI to keep falling over the months to come. The CPI rate was also affected by prices on alcohol and tobacco. However, it is thought that the effects from these products will be reversed soon because the increases in duty are taking place a month later this year than they did last year.

The ONS report went on to show that the RPI measure of inflation, which is often used to set wages and includes mortgages interest payments, fell to the lowest level since records began in 1948, dropping to -1.2%. The nation’s economy is also expected to shrink at the fastest level since the Second World War over the course of this year.