The Bank for International Settlements has warned that UK debt levels are damaging economic growth, the Telegraph reports.

The financial watchdog found that debt is stunting growth in all three types of non-financial sector borrowing: government, household and economic.

BIS monetary and economic department head, Stephen Cecchetti, wrote in a paper presented at the recent Jackson Hole summit: "when [debt] is used imprudently and in excess, the result can be disaster."

Looking at the point at which debt stops supporting growth and begins to inhibit it, the BIS found the threshold for government debt is between 80pc and 100pc of a country's gross domestic product. The threshold is closer to 90pc for corporate debt and around 85pc for household debt.

The UK's debt exceeds the limits in all of these areas, particularly corporate debt which is at 126pc.