Strains in the credit system were highlighted by Bank of England data on Thursday showing that lending to households and private non-financial companies – the backbone of the economy – rose year on year in September by just 6.8 per cent.

This is the weakest credit growth since the collapse of hedge fund Long Term Capital Management in October 1998. Similarly, deposits held by households and PNFCs rose by just 4.9 per cent in September, a record low, implying that businesses are drawing on internal financing as other sources of credit become more scarce or expensive.