Menu
10/04/2008
Interest Rates Reduced to 5%
The Bank of England's Monetary Policy Committee have cut interest rates from 5.25% to 5% to stabilise the economy as the global credit crunch reaches UK shores.
The British Chambers of Commerce warned that the cut was "no longer sufficient".
David Kern, Economic Adviser to the British Chambers of Commerce, said: "Although this move was expected, sadly it is overdue and a reduction to 5.00 per cent is no longer sufficient. We urge the MPC to consider a further cut in rates in May to 4.75 per cent.
"The ominous warnings in the Bank of England’s recent Credit Conditions Survey highlight the growing risks that the credit crunch may be worsening. Therefore, it is vitally important to ensure that problems in the financial sector and in the housing market do not damage wealth-creating businesses.
"We acknowledge that inflation remains a serious problem, meaning the MPC cannot afford to cut rates too aggressively. But, the threats to growth have become immediate and the MPC must be more pro-active. One cannot dismiss the danger that falling house prices may harm consumer spending and the wider economy. Undue delay in acting, threatens to reduce the effectiveness of interest rate cuts that the MPC itself has anticipated already."
Michael Coogan Director of the Council of Mortgage Lenders, commented: "This is good news for those borrowers with mortgages tracking the bank base rate.
"But in these dysfunctional market conditions, the base rate is not in itself a good guide to the cost or availability of funds to lenders.
"To improve the market in which lenders are operating and restore consumer confidence, the bank needs to coordinate successive base rate cuts with further injections of more widely available liquidity.
"We would like to see another base rate cut next month partnered with more liquidity auctions, of higher amounts, over longer terms, and available to a wider range of institutions. This coordinated approach would help to show the authorities are serious about tackling the market problems.”
Leading lenders Halifax, Nationwide, Woolwich and Barclay have agreed to cut their standard variable mortgage rates by the full quarter of a percentage point.
The number of mortgages taken out in February fell to 49,000, the fourth monthly decline from last November, according to figures from the Council of Mortgage Lenders.
The Bank of England has now cut interest three times since December.
(DS/KMcA)
The British Chambers of Commerce warned that the cut was "no longer sufficient".
David Kern, Economic Adviser to the British Chambers of Commerce, said: "Although this move was expected, sadly it is overdue and a reduction to 5.00 per cent is no longer sufficient. We urge the MPC to consider a further cut in rates in May to 4.75 per cent.
"The ominous warnings in the Bank of England’s recent Credit Conditions Survey highlight the growing risks that the credit crunch may be worsening. Therefore, it is vitally important to ensure that problems in the financial sector and in the housing market do not damage wealth-creating businesses.
"We acknowledge that inflation remains a serious problem, meaning the MPC cannot afford to cut rates too aggressively. But, the threats to growth have become immediate and the MPC must be more pro-active. One cannot dismiss the danger that falling house prices may harm consumer spending and the wider economy. Undue delay in acting, threatens to reduce the effectiveness of interest rate cuts that the MPC itself has anticipated already."
Michael Coogan Director of the Council of Mortgage Lenders, commented: "This is good news for those borrowers with mortgages tracking the bank base rate.
"But in these dysfunctional market conditions, the base rate is not in itself a good guide to the cost or availability of funds to lenders.
"To improve the market in which lenders are operating and restore consumer confidence, the bank needs to coordinate successive base rate cuts with further injections of more widely available liquidity.
"We would like to see another base rate cut next month partnered with more liquidity auctions, of higher amounts, over longer terms, and available to a wider range of institutions. This coordinated approach would help to show the authorities are serious about tackling the market problems.”
Leading lenders Halifax, Nationwide, Woolwich and Barclay have agreed to cut their standard variable mortgage rates by the full quarter of a percentage point.
The number of mortgages taken out in February fell to 49,000, the fourth monthly decline from last November, according to figures from the Council of Mortgage Lenders.
The Bank of England has now cut interest three times since December.
(DS/KMcA)
Related UK National News Stories
Click here for the latest headlines.
06 November 2008
Bank Of England Slashes Interest Rates To 3%
The Bank of England has reduced interest rates by 1.5% in a dramatic attempt to rescue Britain from the grip of recession. The cut - which takes interest rates to 3% - follows widespread calls from industry for a major reduction, as the country faces the prospect of a deep recession.
Bank Of England Slashes Interest Rates To 3%
The Bank of England has reduced interest rates by 1.5% in a dramatic attempt to rescue Britain from the grip of recession. The cut - which takes interest rates to 3% - follows widespread calls from industry for a major reduction, as the country faces the prospect of a deep recession.
08 September 2005
Interest rates remain on hold at 4.5%
The Bank of England has left interest rates unchanged at 4.5%, as expected by many analysts. Last month, the Bank’s Monetary Policy Committee (MPC) reduced interest rates from 4.75% to 4.5%, amid fears of a slowdown in economic growth and a slump in consumer spending.
Interest rates remain on hold at 4.5%
The Bank of England has left interest rates unchanged at 4.5%, as expected by many analysts. Last month, the Bank’s Monetary Policy Committee (MPC) reduced interest rates from 4.75% to 4.5%, amid fears of a slowdown in economic growth and a slump in consumer spending.
08 January 2009
Interest Rates Reach All-Time Low Of 1.5%
The Bank of England has cut interest rates to 1.5%, as it is rumoured the Chancellor is considering printing more money in an attempt to alleviate the pressures of the credit crunch. The Bank's Monetary Policy announced the cut of 0.5 percentage point, taking it to its lowest level in its 315-year history.
Interest Rates Reach All-Time Low Of 1.5%
The Bank of England has cut interest rates to 1.5%, as it is rumoured the Chancellor is considering printing more money in an attempt to alleviate the pressures of the credit crunch. The Bank's Monetary Policy announced the cut of 0.5 percentage point, taking it to its lowest level in its 315-year history.
07 August 2008
Interest Rates Held
The Bank of England has kept interest rates at 5% for the fourth month in a row in a bid to balance slow growth and rising inflation. The Monetary Policy Committee's (MPC) primary goal is to reduce the current inflation rate of 3.8% to the Government target of 2%.
Interest Rates Held
The Bank of England has kept interest rates at 5% for the fourth month in a row in a bid to balance slow growth and rising inflation. The Monetary Policy Committee's (MPC) primary goal is to reduce the current inflation rate of 3.8% to the Government target of 2%.
10 April 2003
Bank of England hold interest rates at 3.75%
The Bank of England's Monetary Policy Committee has today voted to maintain the Bank's rate at 3.75%. There was no accompanying statement from the Bank, but Sterling firmed slightly on the news that the rate was unchanged.
Bank of England hold interest rates at 3.75%
The Bank of England's Monetary Policy Committee has today voted to maintain the Bank's rate at 3.75%. There was no accompanying statement from the Bank, but Sterling firmed slightly on the news that the rate was unchanged.
-
Northern Ireland WeatherToday:A dry and sunny start but cloud bubbling up with a few showers developing from late morning. Sunny intervals and scattered showers in the afternoon, these could be heavy at times. Maximum temperature 12 °C.Tonight:Remaining cloudy with a few showers continuing through the evening. Some drier, clearer spells in the early hours, before cloud builds and showers turn more persistent towards dawn. Minimum temperature 4 °C.
