The Bank of England (BoE) has today cut interest rates by o.25% to 5%, the third 25 basis point cut since December 2007. The move comes as the Bank looks to mitigate the impact of the credit crunch and the slowndown in the property sector.

Many of the big lenders have already stated that they will pass on the rate cut in full by reducing their standard variable rates (SVR). Whilst this is great news for those with mortgages linked to the SVR or the Bank of England base rate, it does not paint the full picture. (more…)

The Bank of England’s Monetary Policy Committee (MPC) voted 7 - 2 in favour of interest rates remaining on hold at 5.25%., citing the need to focus on inflation as the reason for the decision. The two dissenting voters wanted a quarter point cut to follow the 0.25% cut in February.

The news that there was mixed views in the committee, together with the aggresive 0.75% cut in the US could pave the way for a cut in April, a month sooner than many commentators had originally suggested.

The Bank of England’s Monetary Policy Committee (MPC) has kept rates on hold at 5.25%. The decision was widely expected by analysts who are predicting a further rate cut in May and possibly another cut later in the year.

Keeping rates at 5.25% could well have been a close call by the Committee as they had a real mixed bag of data and performance indicators to work with. House prices and mortgage approvals continue to slow, whilst price increases on food and fuel remain high. The balancing act has resulted in a ‘wait and see’ approach and so that’s what we’ll need to do.