No change in interest rates for March
Following the latest Monetary Policy Committee meeting last week the Bank of England has decided to keep interest rates on hold amidst concerns over rising inflation. Although there have been calls for the central bank to cut rates as a result of the flagging economy officials have also had to take into consideration the risks of rising inflation as well as a slowing economy.
Interest rates have already been cut twice since December, with two 0.25% cuts taking the base rate from 5.75% to 5.25%. Many economists had predicted a 50-50 chance of a further rate cut in March, but the decision to keep rates on hold came as no big surprise to most. However, with consumer confidence, house prices, and the economy all continuing to suffer it is thought that there will be at least one more rate cut before the summer.
One industry official stated: “We expect the next move to come in May, in line with the consensus view, and see Bank Rate falling to a low of 4.5 percent by the end of this year.”
Another industry official said that the news was good for savers but not for borrowers hoping to see a reduction in the cost of borrowing.
He said: “Despite interest rates being the same now as they were in January 2007, banks have shifted their prices considerably over that period. The real losers are customers who are not aware of how the market has changed. If you have a savings account that pays less than the base rate you should take your business elsewhere, and fast. Banks aren’t bothered about showing loyalty to their customers so don’t worry about showing loyalty to yours.”
Recent news:
- House builder warns on house prices
- Buy to let mortgage figures soar
- Are Cheap Mortgages Coming Back on the Market?
- End Of The Road For 125% Mortgages
- End Of The Road For 125% Mortgages
Related Posts
No change to interest rates for September
With the September Monetary Policy Committee meeting having been held last week the Bank of England has announced that there is to be no change in the current base interest rate, which will remain at its record low of just 0.5 percent for yet another month. »
Interest rates for August remain on hold
The Bank of England has announced that the base rate for August is to be held at 5% following the Monetary Policy Committee meeting, which was held last week to determine any movement in the base interest rate. It is a move that has come as no big surprise to most, with soaring inflation levels and the slowing economy making it difficult for the members of the MPC to make any changes to the base rate.»
Base rate stays the same for June
Earlier this month the Monetary Policy Committee met for its monthly meeting in order to discuss the base rate, and it was decided following the meeting that the base interest rate would be kept on hold at 5%. The base rate was last cut in April, following two earlier rate cuts. However, despite concerns over the slowing economy and the effects of the global credit crunch on consumer finance and confidence the Bank of England decided to focus more on rising inflation levels, thus deciding to keep the base rate at 5%. »
No change for the base rate for June
Last week saw members of the powerful rate setting Monetary Policy Committee meet up for their monthly meeting, and following the meeting the Bank of England announced that the base rate would be staying on hold at 5% for this month – a move that many industry officials have already been expecting. Most already knew that the decision faced by MPC members was a tough one, as they have to balance the slowing economy with soaring inflation levels when determining interest rate movement.»
Further rate cuts may be put on hold for this year
In a recent speech the governor of the Bank of England, Mervyn King, said that there was a good chance that any further interest rate cuts for the remainder of this year would be put on hold, with the central bank now concerned that the soaring rate of inflation is getting more and more out of control. Despite the state of the economy, with many concerned that the nation is on the brink of recession, the governor has indicated that there could be no further interest rate cuts this year.»
[...] No change in interest rates for March [...]