The Bank of England has opted to cut the base rate of interest by a quarter-point to 5.25 per cent, it has been announced.
With millions of people struggling to become debt free around the country, the reduction of the base rate is likely to come as welcome news to British borrowers.
Analysts have suggested that the bank’s decision to cut the cost of borrowing will be particularly beneficial to the thousands of homeowners who are set to remortgage as their fixed-rate arrangements expire.
In fact, the Newcastle Building Society has claimed that the quarter-point reduction in the base rate of interest will make a “big difference” to the finances of millions of British homeowners.
However, the building society also stated: “A single (quarter-point) cut obviously won’t solve the current pressing economic issues and I would expect the Bank of England to follow the Federal Reserve’s lead in making further cuts through the year.”
Many people have seen their debt management problems increase in recent years following a string of rises in the cost of borrowing prompted by the Bank of England.