Thursday, 5 February 2009

Bank of England ready to cut interest rates to 1%

From The Press Association:
Savers look set to suffer if the Bank of England reduces interest rates to a new record low.

The Monetary Policy Committee (MPC) is widely expected to cut the base rate by a further 0.5% to 1%.

And while the move spells more good news for borrowers, it is a further blow for savers, who have already seen the return they get on their money dive by 75% since rates first began to fall.

Figures published by the Bank of England last month showed that in December, interest paid on notice accounts, tax-free ISAs and bonds was the lowest since records began in 1995, while the average return on instant access accounts was just 0.81%.

The already low figures do not factor in the impact of January's 0.5% cut, which will have further reduced savings returns.

While many banks and building societies have failed to pass on January's interest rate cut to borrowers on their standard variable rates, the majority have slashed their savings rates, cutting them by up to 1% in some cases.
What's that word that rhymes with bankers?

Full story HERE.

2 comments:

Sean Lynch said...

As far as Brown and the rest of the comissars are concerned savers are expendable as they are less likely to be lemming like labour voters.
They actually think and plan their lives more than one day ahead.
Labour voters to me are clinically brain dead.

life insurance Canada said...

Traditional attitude, with traditionally no effect. The lower the interest rate, the more more people willing to invest and the less willing to save. The more papers have to be printed and the bigger damage to the REAL economy. When will we overcome this nonsense of central banking??
Lorne