BSA discourages interest rate cut - Economy - News - Moneyfacts


BSA discourages interest rate cut

BSA discourages interest rate cut

Category: Economy

Updated: 03/03/2009
First Published: 03/03/2009

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

The Building Societies Association has said that a Bank of England decision to cut interest rates again this week would be bad news for almost everybody connected with the savings and mortgage markets.

The Monetary Policy Committee will make a decision this week but the BSA believes a further reduction would be bad news for savers, borrowers and institutions alike.

It said that banks and building societies would find it difficult to lend more money because of the increasing low interest rate, while customers would see cuts in the amount of products available, such as mortgages and unsecured loans.

"If the Bank of England wishes to make a contribution to a recovery in the housing and mortgage markets, it should not cut interest rates this month," said Adrian Coles, director general.

"We need to encourage an increase in the flow of funds into the mortgage market, not take steps that would further restrict that flow."

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

Related Articles

Base rate remains unchanged in surprise decision

Earlier today, the Bank of England’s rate setting committee announced that it had voted decisively to keep base rate on hold at its record low of 0.5%. But what does it mean for you?

Budget 2016 – an overview

Well, George Osborne has just revealed the Budget for 2016 – his eighth so far as Chancellor – and as ever, there were some winners and losers from the whole thing. Below is a quick overview of the key points.

What does a US Fed rise mean for the UK?

The US Federal Reserve has decided to raise interest rates, and although you may not think that financial events happening in the US will have much of an impact on UK soil, you may be surprised…