Base rate cut due next week, economists predict

Several economists questioned in a new survey have forecast that the Bank of England will announce a further base rate reduction next week, something that could help borrowers with their debt management.

In a poll carried out by Adfero, nine out of the 11 analysts and business delegates predicted that a cut will be made, while two were undecided.

And most of the finance experts polled thought that a reduction of 50 basis points is likely to be unveiled following Thursday’s meeting of the Bank’s monetary policy committee (MPC).

“I assume they will take rates as low as they can before they start quantitative easing,” commented UK economist for Barclays Capital Simon Hayes.

Global Insight economist Howard Archer agreed that a 50 basis point cut will probably be decided upon, but added that it may not be “quite the forgone conclusion that other recent cuts have been”.

February’s meeting of the MPC culminated in the base rate being lowered from 1.5 per cent to one per cent.

By Jamie Price