Bank tipped to make 0.25% cut to base rate
Analysts are tipping the Bank of England's monetary policy committee (MPC) to cut interest rates this week, amid signs of an economic downturn. The MPC is expected to trim rates by 0.25 per cent, bringing the key base rate of interest to five per cent. Factors informing the decision are thought to include signs that the housing market is softening - as born out by a study from the Halifax yesterday which showed that house prices slumped 2.5 per cent during February. Indications that retail spending is moderating are also expected to influence the MPC. Richard Lambert, director of the Confederation of British Industry, said: "Despite the MPC's attempts to loosen monetary policy through two recent interest rate cuts, the credit crunch is pushing interbank and mortgage lending rates up, which is constraining economic activity and demand. "The Bank should make a quarter point cut now, rather than later, to help hard-pressed businesses and consumers."The Bank has cut interest on two occasions since December.
Share this..
Related stories
Free banking is disappearing at an alarming rate
As we hear news that Egg, the Citibank owned credit card brand, is set to reintroduce an annual fee for holders of the company's credit card it appears that the days of free banking in the UK are fast disappearing. While there are those who believe that free banking was never actually available in the UK, with UK banks using consumer deposits to fund their other operations, we will start to see th...
Read MoreConfidence is returning but has the economy turned?
Today we see JD Wetherspoon announcing record figures and profits nearly 10% ahead of consensus forecasts, we hear that property prices are yet again on the rise and mortgage liquidity appears to be improving. On top of that there is the assumption that the UK economy may well have left the recessionary period in May this year and looks set to move on to the growth path in the latter part of 2009....
Read MoreAlistair Darling floats the idea of a bad bank
Slowly but surely the UK government would appear to be leaking various details of the proposed "bad bank" which would use taxpayer money to acquire potentially toxic assets from a variety of UK banking operations. Initially the idea had been suggested some months ago due to other options and a general discomfort amongst UK taxpayers it appeared that the "bad bank" idea had been dropped. So who wou...
Read MoreFour in Ten Britons could be hit by swine flu
As the government's Cobra emergency committee gathers in London there are serious concerns that the ongoing outbreak of swine flu could impact upon four in ten Britons if it becomes a pandemic. The situation in the UK has worsened over the last few hours with possible new cases in Wiltshire, Derbyshire, Yorkshire and Wales not to mention a flurry of other cases overseas.
However, be...
BSkyB goes on the offensive over BT pension plans
As we covered earlier today, British Telecom is looking at a pension fund deficit in excess of £9 billion and has been in talks with the regulator Ofcom to try and find a solution to this growing problem. Despite the fact that the company has increased its premiums to the pension fund by hundreds of millions of pounds a year there is still a growing shortfall which needs to be addressed sooner ra...
Read More