Money News
7th August 2008
No cut in borrowing costs, as Bank holds interest rates
Borrowers hoping for a cut in repayment rates on personal loans and mortgages have been disappointed after the Bank of England's monetary policy committee today voted to hold the key base rate at five per cent.
The move means it is less likely that lenders will be able to cut the cost of borrowing in the short-term, meaning that rates on mortgages and loans will remain at existing rates for the foreseeable future.
Consumer groups have been calling for a cut to assist Britons struggling with the soaring cost of living.
James Caldwell of Fairinvestment.co.uk said: "The committee is still facing a tricky situation whereby inflationary pressure is posing a serious threat to the UK economy, yet Brits are increasingly struggling to pay their bills.
"Some lenders have already started to lower mortgage interest rates, despite the base rate decision. However, news of an increased number of people unable to meet their monthly mortgage payments, and repossessions, suggests that a base rate cut would have been welcomed with open arms by many."
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