Rate cut unlikely |
02 2008 |
| It looks like the Bank of England will not cut the base rate of interest in May, spelling bad news for homeowners. A new poll of nine major financial institutions shows that all of them think the Bank's Monetary Policy Committee (MPC) will maintain rates this month. It suggests that it is better to rent rather than buy as mortgage costs show no sign of falling. Interest rates currently stand at five per cent and Nationwide said that the odds are stacked against a reduction in May. "We predict there will be a 70 per cent chance that there won't be any change and interest rates will stay the same, a 25 per cent chance that they will be cut by 25 basis points and a five per cent chance that they will be cut by five basis points," said a spokesperson from the building society. The MPC is due to meet on May 8th to announce its decision.  |
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