Interest rates 'to remain on hold'
29.08.2008
The Bank of England's monetary policy committee (MPC) is unlikely to reduce interest rates next month, it has been claimed.
A spokesperson for the Council of Mortgage Lenders (CML) said until inflation begins to reduce, the MPC will not be able to "move to ease" interest rates.
"When it does become clearer that we are over the spike of inflation it will have more credibility if it does seek to reduce interest rates in response to the prospect of the economy slowing down sharply," he explained.
Taking action at that point is expected to be "more effective" and will improve confidence in the Bank's decisions, he added.
Earlier this week, the CML reported that there were 144,600 new buy-to-let loans in the first half of this year, compared with 176,500 during the final six months of 2007.
Lenders were found to be offering loans worth 83 per cent of the value of a property on average - two per cent lower than a year earlier, the council stated.
A spokesperson for the Council of Mortgage Lenders (CML) said until inflation begins to reduce, the MPC will not be able to "move to ease" interest rates.
"When it does become clearer that we are over the spike of inflation it will have more credibility if it does seek to reduce interest rates in response to the prospect of the economy slowing down sharply," he explained.
Taking action at that point is expected to be "more effective" and will improve confidence in the Bank's decisions, he added.
Earlier this week, the CML reported that there were 144,600 new buy-to-let loans in the first half of this year, compared with 176,500 during the final six months of 2007.
Lenders were found to be offering loans worth 83 per cent of the value of a property on average - two per cent lower than a year earlier, the council stated.
Compare cheap loans:
Privacy Protection learn more